K. Gabriel Heiser
Attorney, author, Medicaid asset protection planning
K. Gabriel Heiser, J.D., is an attorney with over 25 years of experience in elder law and estate planning. He is the author of "How to Protect Your Family's Assets from Devastating Nursing Home Costs: Medicaid Secrets," an annually updated practical guide for the layperson.
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Question
Can someone explain a live interest on a deed?
I assume you were granted a remainder interest in the house and your mom kept a life estate. At least that is how this would usually be... I assume you were granted a remainder interest in the house and your mom kept a life estate. At least that is how this would usually be done. If you sell the house, the proceeds must be divided based on a "Life Estate/Remainder" table published by the government. This table takes into account your mom's age: the older she is at the time you sell the house, the lower the percentage to which she is entitled. see more
Question
What's the first step to getting Medicaid?
Since you have time to plan, I recommend you get started learning what you can and can't, should or shouldn't do. That's why I... Since you have time to plan, I recommend you get started learning what you can and can't, should or shouldn't do. That's why I wrote my book on Medicaid planning, How to Protect Your Family's Assets From Devastating Nursing Home Costs: Medicaid Secrets (www.MedicaidSecrets.com). I hope it will be of some help to you. You may be able to find it in the library, too. see more
Question
What is the better solution to dispersing joint checking account funds upon death of my mother?
A gift of money from one person to another is not counted as taxable income to the recipient. Assuming the amounts are not subject to any... A gift of money from one person to another is not counted as taxable income to the recipient. Assuming the amounts are not subject to any gift tax (only applies to very large amounts of money), it is simple just to divvy up the money after your mother's death. There is no reason to increase the probate estate by putting the money back into your mother's sole name.
A better arrangement is to have the account in your mother's sole name, with all three children as Pay On Death (POD) beneficiaries, and then give just you a power of attorney to access the account via check, etc. see more
A better arrangement is to have the account in your mother's sole name, with all three children as Pay On Death (POD) beneficiaries, and then give just you a power of attorney to access the account via check, etc. see more
Question
Can I delegate POA to some else?
Typically an agent cannot delegate or share their powers under the POA. The document may of course name a successor or a co-agent, but... Typically an agent cannot delegate or share their powers under the POA. The document may of course name a successor or a co-agent, but otherwise the general rule is the agent under the POA cannot themselves name a successor or co-agent. see more
Question
Can seniors prepay a personal caregiver agreeent thus making them Medicaid eligible?
The answer depends on what state you are in. Some states recognize lump-sum pre-paid Personal Care Contracts, while other states require... The answer depends on what state you are in. Some states recognize lump-sum pre-paid Personal Care Contracts, while other states require the care be paid for by ongoing payments only. If the state allows pre-paid lump-sum payments, then all that money will be deemed in exchange for future services to be rendered, thus will not be deemed a penalty-causing gift, for Medicaid eligibility purposes. see more
Question
What will happen if my Mom is penalized for the sale of her house within the 5 yr limit?
The caregiver child must live in the parent's house with the parent, for at least the two-year period immediately preceding the parent... The caregiver child must live in the parent's house with the parent, for at least the two-year period immediately preceding the parent entering the nursing home. The parent must have needed nursing home-level care and the child must have provided such care that allowed the parent to delay going to the nursing home. If such is the case, then the parent can deed the house to that child without any Medicaid penalties. see more
Question
What will happen if my Mom is penalized for the sale of her house within the 5 yr limit?
Selling a house for $1.00 is still a gift of the full value of the house (less $1.00!). So if your mom applies for Medicaid within five... Selling a house for $1.00 is still a gift of the full value of the house (less $1.00!). So if your mom applies for Medicaid within five years of such gift, there will be a penalty period of that number of months equal to the value of the house on the date of the gift ($60,000) divided by the state "penalty divisor" (varies from state to state). If the penalty divisor is indeed exactly $5,000, then it would be 12 months penalty period. If she were already on Medicaid when she deeded the house, then Medicaid will immediately disqualify her for 12 months from the date of the gift. You have an affirmative duty to tell the state about the sale.
The gifts TO your mother's bank account will not affect her eligibility unless it causes her to have more than $2,000 at the time she applies. So that is less of a problem. see more
The gifts TO your mother's bank account will not affect her eligibility unless it causes her to have more than $2,000 at the time she applies. So that is less of a problem. see more
Question
How does a reverse mortgage affect NH care if the person has only SS and VA financial assistance for income?
Monthly payments from a reverse mortgage do not count as "income" for Medicaid purposes, but any payments not consumed or... Monthly payments from a reverse mortgage do not count as "income" for Medicaid purposes, but any payments not consumed or converted to a non-countable form by the end of the month of receipt are then counted as an asset in the following month. In most cases, a reverse mortgage is not advisable for a single person who may move to a nursing home soon, because it will have to be repaid within 12 months of vacating the house. However, if there is a spouse at home, then sometimes a reverse mortgage can be helpful to that spouse to pay the bills, go on vacation, etc. I have a section on reverse mortgages in my book, "How to Protect Your Family's Assets from Devastating Nursing Home Costs: Medicaid Secrets" (www.MedicaidSecrets.com), in which I also discuss a new technique called a reverse private mortgage. see more
Question
How long do I have to wait to sell my home after my husband passes away?
The caretaker exception that allows transfer of a home to a person who cared for the Medicaid recipient for at least two years, etc., only... The caretaker exception that allows transfer of a home to a person who cared for the Medicaid recipient for at least two years, etc., only applies if the caretaker is a child of the Medicaid recipient. see more
Question
How long do I have to wait to sell my home after my husband passes away?
If you are the sole owner of the house, then Medicaid for your husband cannot touch the home. If the home is titled in joint names (you and... If you are the sole owner of the house, then Medicaid for your husband cannot touch the home. If the home is titled in joint names (you and he both on the deed), then it is possible that his 50% interest can be at risk, depending on your state law. That's because some states permit recouping the Medicaid bills against jointly held property, and other states do not permit that. So you will need to check with an elder law attorney in your state to be sure you know what the law is in your state. see more
Question
Mom applying for Medicaid can she be penalized for the sale of her house she gave to her son 2 yrs ago?
Unfortunately, the Caretaker Child exception only eliminates the transfer penalty if it is applicable at the time of the transfer of the... Unfortunately, the Caretaker Child exception only eliminates the transfer penalty if it is applicable at the time of the transfer of the home. (Such exception applies if at the time of the transfer of the home to a child, the child has already lived in the home with the parent for at least two years immediately before the parent entered the nursing home and whose care allowed the parent to delay moving to the nursing home. 42 U.S.C. §1396p(d)(4)(A).)
It's always possible--if not necessarily practical--to reverse a penalty-causing gift, but it sounds like in your case the house has already been sold. If the proceeds then went to your brother, he could give the money back to your mom, who could then do proper Medicaid planning to reduce the amount of money so she can qualify for Medicaid sooner. Otherwise, if she applies for Medicaid within 5 years of the transfer of the house to your brother, there will be a long penalty period. see more
It's always possible--if not necessarily practical--to reverse a penalty-causing gift, but it sounds like in your case the house has already been sold. If the proceeds then went to your brother, he could give the money back to your mom, who could then do proper Medicaid planning to reduce the amount of money so she can qualify for Medicaid sooner. Otherwise, if she applies for Medicaid within 5 years of the transfer of the house to your brother, there will be a long penalty period. see more
Question
Will Medicaid deduct the 4 years that the house is already deeded to my son?
The penalty period can extend beyond 4 years, even beyond 5 years! That depends on the value of the gift and the state's then-current... The penalty period can extend beyond 4 years, even beyond 5 years! That depends on the value of the gift and the state's then-current "penalty divisor" (roughly equivalent to the average cost of a nursing home stay in the particular state). The calculation divides the gift value by the state penalty divisor, and the resulting number is the number of months' penalty, i.e., period of disqualification from receiving Medicaid. By waiting to apply for Medicaid at least 5 years from the date of a gift, that gift is no longer considered for Medicaid eligibility purposes. see more
Question
Can the state take my home if I am the caregiver for a parent who will eventually need a higher level of care...
If the new home is titled solely in your name, then your father has made a gift to your of the equity from his former home, and if he... If the new home is titled solely in your name, then your father has made a gift to your of the equity from his former home, and if he applies for Medicaid within 5 years, that gift will cause a period of disqualification.
If the home is titled in joint names, then as long as the value of his joint interest in the new home at least equals his equity in the house he sold, no gift is made. Then, if your care for your father (for at least the two-year period immediately preceding his entering the nursing home) enabled him to delay going to the home, he can legally transfer his interest in the home at that time, and there will be no transfer penalty. If you plan to go this route, you will need (i) a letter from a physician indicating that your father is in need of nursing-home-level care, and (ii) detailed records of what you do to care for him. Your state may have additional requirements you should find out about. The state will want this should your father later sign a deed of his interest over to you (after he enters the nursing home), to avoid characterizing the deed as a gift. see more
If the home is titled in joint names, then as long as the value of his joint interest in the new home at least equals his equity in the house he sold, no gift is made. Then, if your care for your father (for at least the two-year period immediately preceding his entering the nursing home) enabled him to delay going to the home, he can legally transfer his interest in the home at that time, and there will be no transfer penalty. If you plan to go this route, you will need (i) a letter from a physician indicating that your father is in need of nursing-home-level care, and (ii) detailed records of what you do to care for him. Your state may have additional requirements you should find out about. The state will want this should your father later sign a deed of his interest over to you (after he enters the nursing home), to avoid characterizing the deed as a gift. see more
Question
Will Medicaid deduct the 4 years that the house is already deeded to my son?
It's possible that a reverse mortgage could work in your situation, although it would be costly. But it could allow you to get the... It's possible that a reverse mortgage could work in your situation, although it would be costly. But it could allow you to get the money to pay for the 12 months of Dad's nursing home care. Note that after the borrower/homeowner is absent 12 months from the home, the reverse mortgage must be repaid, so that's the farthest extent of time it could possibly buy you. see more
Question
Will Medicaid deduct the 4 years that the house is already deeded to my son?
More specifically to answer the question, Medicaid uses an all-or-nothing calculation: if the gift was made within the five-year period... More specifically to answer the question, Medicaid uses an all-or-nothing calculation: if the gift was made within the five-year period preceding the date you apply for Medicaid, then the full value of the gift on the date it was made causes a penalty period. If it's over five years, then nothing is included towards a penalty.
Under pre-DRA (the Medicaid law change effective in 2006) law, the penalty did indeed go down each passing month starting with the date of the gift, but under current law it does not. see more
Under pre-DRA (the Medicaid law change effective in 2006) law, the penalty did indeed go down each passing month starting with the date of the gift, but under current law it does not. see more
Question
Will Medicaid deduct the 4 years that the house is already deeded to my son?
Unless one of the transfer exceptions apply (e.g., transfer to a Caregiver Child or disabled child), if your father applies for Medicaid... Unless one of the transfer exceptions apply (e.g., transfer to a Caregiver Child or disabled child), if your father applies for Medicaid before the 5-year lookback period has expired (i.e., more than 5 years from the date he signed the deed and it was recorded at the local register of deeds) he will be facing a VERY long penalty period! The number of months of such disqualification from receiving Medicaid coverage will be equal to the value of the house on the date of the gift divided by your state's average nursing home cost. Such average costs are published each year by each state; you can call your Medicaid department if you really need to know the figure, but to be safe you may wish to wait until AFTER the expiration of the 5-year lookback period. If you are still unsure, then be sure to consult with an elder law attorney in your state with experience in Medicaid planning to answer this specific question. Better safe than sorry! see more
Question
Can any legal action be taken to get my Mom's asset?
Although it is possible that an oral trust was created at the time your mother signed the deed, the general rule is that a trust affecting... Although it is possible that an oral trust was created at the time your mother signed the deed, the general rule is that a trust affecting real estate must be in writing. In addition, it is questionable whether your mom was legally competent at the time she signed the deed, and the deed can therefore be set aside by a judge as invalid. In order to accomplish any of this, however, and to straighten out who owns the house, you will certainly need to contact an attorney to take this to court. It's also possible that your sister may decide to deed the house back into your mother's name once she sees that you are about to go to court over this. see more
Question
DPOA question about gifting?
I always include a specific section on gifting in the DPOA's (Durable Powers of Attorney) I drafted for clients. I believe most... I always include a specific section on gifting in the DPOA's (Durable Powers of Attorney) I drafted for clients. I believe most attorney-prepared powers of attorney would, also. Perhaps more importantly is the inclusion of the ability to make gifts for the purposes of Medicaid planning. Without specific language in the DPOA such large transfers would not be legally permitted, possibly costing the family thousands of dollars because of the lost ability to do proper planning. see more
Question
My Mom has CD's in " trust for " her grandchildren. Are they safe from Medicaid?
In many states, the state can only recoup Medicaid outlays from the deceased's probate estate. Such "in trust for" or POD... In many states, the state can only recoup Medicaid outlays from the deceased's probate estate. Such "in trust for" or POD accounts avoid this, since the account balance bypasses probate and goes directly to the named beneficiary. Also, many states have a de minimis amount, below which they do not bother to go after a deceased's money for repayment. see more
I have submitted a Small Estate Affidavit. Can I get Non-Intervention powers without going through probate?