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
Mother in law divided her money between her two sons three years ago. One son spent the money. Anyone dealing...
If MIL needs to apply for Medicaid within the next two years, the full penalty period may well exceed that two-year period, depending on... If MIL needs to apply for Medicaid within the next two years, the full penalty period may well exceed that two-year period, depending on the amount transferred and the state "penalty divisor" (roughly the average nursing home cost in your state). If that's the case, then it's better to pay privately until the full 5-year period from the date of her gifts (i.e., two years from now) runs out.
Gabriel Heiser see more
Gabriel Heiser see more
Question
Any advice on a banking question for Dad's estate planning?
Be sure you are on the bank account as an "or" joint owner. That gives you immediate access to the account both now (while Dad is... Be sure you are on the bank account as an "or" joint owner. That gives you immediate access to the account both now (while Dad is still living) and immediately following his death, with no necesity of proving his death. An alternative is to title the bank account as "TOD" (transfer on death) so that you have ownership following his death, upon proof he has died (i.e., you have to show the bank the death certificate first).
On small accounts, there is little risk by putting your name on a parent's bank account as joint owner, but if you are sued or divorced, that money may be at risk, unless and until you can prove that money originated from your father and not you. see more
On small accounts, there is little risk by putting your name on a parent's bank account as joint owner, but if you are sued or divorced, that money may be at risk, unless and until you can prove that money originated from your father and not you. see more
Question
I would like to know if there are any good ways to help in remembering all the dates, passwords and login user...
I use a program called LastPass to automatically fill in my passwords. It is great! But sometimes it balks, for whatever reason, so of... I use a program called LastPass to automatically fill in my passwords. It is great! But sometimes it balks, for whatever reason, so of course I also have a file (Ecco Pro, but an Excel spreadsheet would work, too) that is itself password-protected, to hold all the other passwords, usernames, account numbers, etc.
Gabriel see more
Gabriel see more
Question
Who gets paid first when a house is sold, Medicaid or Reverse Mortgage?
You are correct that once your mom is absent from the home for 12 months, the reverse mortgage lender must be repaid, typically requiring a... You are correct that once your mom is absent from the home for 12 months, the reverse mortgage lender must be repaid, typically requiring a sale of the house. Since the loan was secured by the house, the loan is paid back first. Any remaining balance of the sale proceeds--if any--will become an asset of your mother, causing disqualification from Medicaid until that money is either spent down or converted to a form that is non-countable (e.g., pre-paid funeral/burial fund, etc.). see more
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Any advice on the best way to repay transfers to become Medicaid eligible?
Repaying the gifts to you before applying for Medicaid is a good idea. If fully repaid before you apply, such gifts will not count against... Repaying the gifts to you before applying for Medicaid is a good idea. If fully repaid before you apply, such gifts will not count against your mother for purposes of determining her Medicaid applicability. see more
Question
As the sole caregiver for my Mother (96), would money received under a care agreement render ME ineligible for...
Yes, for Medicaid purposes the income from the Caregiver agreement would be added to your other income in determining your Medicaid... Yes, for Medicaid purposes the income from the Caregiver agreement would be added to your other income in determining your Medicaid eligiblity. That being said, income almost never causes a person to be disqualified, since the amount paid to the nursing home or for other medical expenses is simply deducted first (some states require the use of a simple trust--called a Miller Trust--to hold the income before it is passed on to the nursing home). So unless your total income exceeds the actual cost of the nursing home, it should not as a practical matter cause disqualification from Medicaid. see more
Question
Downsizing and Medicaid; Will buying a smaller place so there won't be a mortgage adversely affect my husband'...
The home (up to a value of at least $572,000 in 2018) is an exempt asset regardless of which spouse owns it. It is better that it is in... The home (up to a value of at least $572,000 in 2018) is an exempt asset regardless of which spouse owns it. It is better that it is in your name alone, however, since it will be easier to sell (you won't need your husband's signature on the deed). The new home will also be exempt, so I think it's a good idea you have, to conserve your expenses by downsizing. see more
Question
What would you say are the most important questions to ask in deciding on a competent elder law attorney?
I devote about 5 pages to how to find a good elder law attorney in my book, "How to Protect Your Family's Assets from Devastating... I devote about 5 pages to how to find a good elder law attorney in my book, "How to Protect Your Family's Assets from Devastating Nursing Home Costs: Medicaid Secrets" (12 ed., Phylius Press, www.MedicaidSecrets.com). That said, the suggestions already made here, below, are excellent: NAELA, CELA, percent of practice devoted to elder law, etc. To that list I'd add: find out who teaches elder law and/or Medicaid planning (depending on your needs) at the local and state bar associations; the associations have already done the searching for you, in locating regional experts! see more
Question
How much money can Dad put aside that the nursing home and Medicaid can’t take, $2000?
Yes, an applicant for Medicaid can have up to $2,000 in countable assets (i.e., plus a car of any value, a home, personal items, pre-paid... Yes, an applicant for Medicaid can have up to $2,000 in countable assets (i.e., plus a car of any value, a home, personal items, pre-paid funeral/burial, and some other excludible items). This figure has been in place for many years.
Setting up a trust more than five years in advance of applying for Medicaid is indeed a good idea. However, to be an excludible asset, it needs to be written (drafted) correctly. For example, it cannot permit ANY distributions of the trust principal back to the grantor (person who sets up and funds the trust) for ANY reason, although it is possible to permit distributions of income.
For more info on how to use trusts for Medicaid planning, I recommend my eBook "Trusts to Protect Your Assets from Medicaid", available here: http://medicaidsecrets.com/eBooks.html see more
Setting up a trust more than five years in advance of applying for Medicaid is indeed a good idea. However, to be an excludible asset, it needs to be written (drafted) correctly. For example, it cannot permit ANY distributions of the trust principal back to the grantor (person who sets up and funds the trust) for ANY reason, although it is possible to permit distributions of income.
For more info on how to use trusts for Medicaid planning, I recommend my eBook "Trusts to Protect Your Assets from Medicaid", available here: http://medicaidsecrets.com/eBooks.html see more
Question
Medicare eligibility and deferral, how do I avoid a penalty?
This may help: medicare.gov/sign-up-change-plans/get-parts-a-and-b/employer-coverage/i-have-employer-coverage.html
Question
How do you save your home if your spouse has to go into a memory care facility?
As others have stated, Medicaid planning is not a a do-it-yourself task, because of the complexities of both the federal and state laws,... As others have stated, Medicaid planning is not a a do-it-yourself task, because of the complexities of both the federal and state laws, regulations, and practices. However, it is a good idea to arm yourself with knowledge of what the rules are and what the possibilities are to protect your assets, before you visit with an elder law attorney. Indeed, I even include a section of my book that gives some tips on how to find a good attorney. (www.MedicaidSecrets.com) Good luck!! see more
Question
Is private pay for care a spend-down expense?
Yes, any legitimate expenditure that benefits the future Medicaid applicant is a legitimate use of the funds, and will count as part of the... Yes, any legitimate expenditure that benefits the future Medicaid applicant is a legitimate use of the funds, and will count as part of the "spend down," and not be deemed a gift by Medicaid at the time of application. see more
Question
What defines “giving away money” that disqualifies a person for Medicaid?
If a person who wishes to apply for Medicaid for a nursing home stay makes a transfer of any asset, without it being in exchange for... If a person who wishes to apply for Medicaid for a nursing home stay makes a transfer of any asset, without it being in exchange for something of equal value, then that is a gift of the difference in value. All such gift amounts made within the five years prior t the date of a Medicaid application are totaled at that time, and a penalty period is assessed for a certain number of months.
So for example, if I transfer $500 to my daughter in exchange for her helping me out, that is a gift of the full $500 unless she has given me an itemized list of what she did for me before or contemporaneous with the transfer of $500 to her, and the value of her work equals or exceeds $500. In other words, if she helped me out last year, but did not bill me at that time, I cannot now give her money for that service; it's too late.
You will find these rules in the Medicaid regulations of the state in which you reside. The federal rules simply mention "uncompensated transfers," i.e., gifts.
For a complete discussion of the rules of gifting for Medicaid purposes, see the chapter in my book "How to Protect Your Family's Assets from Devastating Nursing Home Costs: Medicaid Secrets" (MedicaidSecrets.com) or the less-expensive eBook "Gifts: Avoiding the Penalties," available here: medicaidsecrets.com/eBooks.html see more
So for example, if I transfer $500 to my daughter in exchange for her helping me out, that is a gift of the full $500 unless she has given me an itemized list of what she did for me before or contemporaneous with the transfer of $500 to her, and the value of her work equals or exceeds $500. In other words, if she helped me out last year, but did not bill me at that time, I cannot now give her money for that service; it's too late.
You will find these rules in the Medicaid regulations of the state in which you reside. The federal rules simply mention "uncompensated transfers," i.e., gifts.
For a complete discussion of the rules of gifting for Medicaid purposes, see the chapter in my book "How to Protect Your Family's Assets from Devastating Nursing Home Costs: Medicaid Secrets" (MedicaidSecrets.com) or the less-expensive eBook "Gifts: Avoiding the Penalties," available here: medicaidsecrets.com/eBooks.html see more
Question
What are the processes to follow in sending my mother in law to a nursing home?
Definitely do NOT sell the condo yet! In some states, it is possible to create a deed that will allow transfer to children (or others)... Definitely do NOT sell the condo yet! In some states, it is possible to create a deed that will allow transfer to children (or others) without becoming subject to the state's recoupment (reimbursement) requirements. see more
Question
If my father qualifies for Medicaid, will I be impacted?
I wrote an article for AgingCare.com about filial responsibility laws and their impact on Medicaid reimbursement, here:... I wrote an article for AgingCare.com about filial responsibility laws and their impact on Medicaid reimbursement, here: https://www.agingcare.com/articles/filial-responsibility-and-medicaid-197746.htm see more
Question
My mother just passed away, but had a reverse mortgage. If I'm supposed to take it over, how do I release my s...
The mortgage must be paid off following the death of the last homeowner (e.g., if a married couple took out the loan). There is no... The mortgage must be paid off following the death of the last homeowner (e.g., if a married couple took out the loan). There is no "taking over" the loan at this point. If the family members do not want to pay back the bank, then the house must be sold to do so. If there are any remaining proceeds after the sale of the house, it will pass under the terms of the will. see more
Question
Is there any benefit to putting the house in my name now, before my mother passes?
If you continue to care for your mother for the two years before she enters a nursing home, and such care can be documented to show that... If you continue to care for your mother for the two years before she enters a nursing home, and such care can be documented to show that it prevented her from going into a nursing home, then the transfer to you will NOT be deemed a gift under Medicaid rules. To avoid getting her basis in the house upon a later sale, should she gift the house to you, the deed should reserve for her the right to live in it for her lifetime. Such reserved power will cause inclusion of the house in your mother's taxable estate, giving it a tax basis equal to its value on the date of her death.
As you can see, this stuff is complicated and the rules must be carefully followed. Show the above information to a good local elder lawyer, and they can advise and assist you with this! see more
As you can see, this stuff is complicated and the rules must be carefully followed. Show the above information to a good local elder lawyer, and they can advise and assist you with this! see more
Question
My mother is in a nursing home that's trying to get her on Medicaid. How can I get her accounts under the $2,0...
It is not the withdrawal that causes problems, it is how it is spent. As long as the withdrawn money is spent on your mother, it is not a... It is not the withdrawal that causes problems, it is how it is spent. As long as the withdrawn money is spent on your mother, it is not a gift and therefore not a problem. The ideas presented by others, here, are good. A pre-paid funeral/burial is good if there is an amount that warrants that, e.g., $5,-10,000 or so. For smaller amounts, the spend-down ideas suggested by others here are the way to go! see more
Question
Do we have to notify the old POA for the new one to become active?
It is certainly possible to have more than one POA in place at the same time. Thus, to avoid confusion, it is best to (i) revoke all prior... It is certainly possible to have more than one POA in place at the same time. Thus, to avoid confusion, it is best to (i) revoke all prior POAs within the terms of the new POA, (ii) notify the prior agent(s) that the the POA under which they were named has now been revoked, and (iii) request all outstanding signed copies of the prior POA document be returned to you so you can destroy them. see more
Can someone gift me a large amount of money to spend on my mother without my mother losing public benefits?
By the way, a hand-written will is still valid even if not notarized or witnessed, although in your aunt's case, since all your grandfather's assets passed to her outside of probate (as jointly titled accounts), the will would have no effect in any case. see more