Did the attorney who did the document explain it to your mom? Lady Bird Deed only becomes active after moms death. The deed allows her estate to transfer ownership outside of probate and allows her to still maintain control over the property while alive, which means she can keep her homestead exemption and any other over age 65 perks on property taxes. If mom is still alive, it hasn’t transferred over to you just yet. It’s still hers.
That house can transfer outside of probate, allows it to bypass estate recovery (MERP) attempt should mom go onto Medicaid after age 55. So basically whomever named in the Deed can inherit her home after her death. Lady Bird only done in a handful of states, like MI & TX. Its legit Medicaid planning in those states.
Although sounds easy peasy, it can pose challenges, imo here’s why: LTC Medicaid (in a facility like a NH) requires those on LTC Medicaid to do a copay of almost all their monthly income to the NH. All they get to keep is whatever your State has as a personal needs allowance. PNA is $50-$60 a mo for most states and really gets spent at the NH for beauty shoppe, toiletries / clothing replacement. Because of income copay requirement, moms property costs will have to be paid by others. If only you on Lady Bird then it’s kinda all on you to pay. If other siblings also on it, hopefully they will all pay their % share.
If you aren’t familiar with what mom spends to keep her house running, please go thru her financials and add it up. Average stay in a NH is 2.5 years, so realistically you need to be able to pay at least 3 years of her house costs plus an emergency fund. Her annual property taxes really should be paid otherwise property will have hefty interest on the delinquency and will go up for tax sale, plus unpaid taxes will cloud the title from transferring.
Lady Bird Deeds are great but imo you have to have the ability to front all house co$t$ & do whatever to keep the house up till after mom dies and it can finally transfer. I’ve been on this forum quite a while and what seems to happen (whether a Lady Bird Deed, a Trust, Life Estate, etc) when elders keep their home but move into a facility is that someone who promised to do things or pay for things just stops….. family squabbles…. so house gets put up for sale. When it sells, as it still technically belongs to the elder, as they r still alive, so all the $ from Act of Sale is theirs. They go off Medicaid & do a spend down. No gifting.
To make a Lady Bird work, you kinda have to be in this for the long view, whether 5 months or 5 years. You have to have the time and resources for an indeterminate amount of time. Hope it’s totally feasible for you. Good luck!
Per Google: A Lady Bird Deed is a transfer of property to another with a reservation of a life estate. Meaning a person can transfer property and retain ownership in that property until death, at which point it will then transfer to the other.
I suggest you sit down with a Certified Elder Care attorney who can advise you about Medicaid requirements and 5 year lookbacks, etc. Just b/c your mother deeded her house to you does not necessarily mean it's 'protected' from being considered an asset by Medicaid.
Lady Bird Deed only becomes active after moms death. The deed allows her estate to transfer ownership outside of probate and allows her to still maintain control over the property while alive, which means she can keep her homestead exemption and any other over age 65 perks on property taxes. If mom is still alive, it hasn’t transferred over to you just yet. It’s still hers.
That house can transfer outside of probate, allows it to bypass estate recovery (MERP) attempt should mom go onto Medicaid after age 55. So basically whomever named in the Deed can inherit her home after her death. Lady Bird only done in a handful of states, like MI & TX. Its legit Medicaid planning in those states.
Although sounds easy peasy, it can pose challenges, imo here’s why: LTC Medicaid (in a facility like a NH) requires those on LTC Medicaid to do a copay of almost all their monthly income to the NH. All they get to keep is whatever your State has as a personal needs allowance. PNA is $50-$60 a mo for most states and really gets spent at the NH for beauty shoppe, toiletries / clothing replacement. Because of income copay requirement, moms property costs will have to be paid by others. If only you on Lady Bird then it’s kinda all on you to pay. If other siblings also on it, hopefully they will all pay their % share.
If you aren’t familiar with what mom spends to keep her house running, please go thru her financials and add it up. Average stay in a NH is 2.5 years, so realistically you need to be able to pay at least 3 years of her house costs plus an emergency fund. Her annual property taxes really should be paid otherwise property will have hefty interest on the delinquency and will go up for tax sale, plus unpaid taxes will cloud the title from transferring.
Lady Bird Deeds are great but imo you have to have the ability to front all house co$t$ & do whatever to keep the house up till after mom dies and it can finally transfer. I’ve been on this forum quite a while and what seems to happen (whether a Lady Bird Deed, a Trust, Life Estate, etc) when elders keep their home but move into a facility is that someone who promised to do things or pay for things just stops….. family squabbles…. so house gets put up for sale. When it sells, as it still technically belongs to the elder, as they r still alive, so all the $ from Act of Sale is theirs. They go off Medicaid & do a spend down. No gifting.
To make a Lady Bird work, you kinda have to be in this for the long view, whether 5 months or 5 years. You have to have the time and resources for an indeterminate amount of time. Hope it’s totally feasible for you. Good luck!
A Lady Bird Deed is a transfer of property to another with a reservation of a life estate. Meaning a person can transfer property and retain ownership in that property until death, at which point it will then transfer to the other.
I suggest you sit down with a Certified Elder Care attorney who can advise you about Medicaid requirements and 5 year lookbacks, etc. Just b/c your mother deeded her house to you does not necessarily mean it's 'protected' from being considered an asset by Medicaid.
Good luck!