Care Giving Child and Transfer of Home

Friday, December 4, 2020

    In some circumstances, a Medicaid recipient, or even a person who is planning to make a Medicaid application, may be able to transfer their home to children who lived in the home with them for a certain period, and who provided a certain level of care during that period.

    This transfer must take place within the Medicaid recipient’s lifetime, however, and it cannot take place before certain conditions have been met for a sufficient period of time.

    This means that the transfer cannot be done by a Will or a trust after the Medicaid recipient’s death.  Once the person has died, the state is a creditor for the amount of care that was provided through Medicaid, and this bill must be paid off before anything that is left passes on to people named in the Will or trust.

    Unfortunately, sometimes the person on Medicaid is no longer competent by the time the necessary time periods have run.

    This creates a problem even if the house is owned together with a spouse, and even if the spouse is on the title with right of survivorship or as a tenant by the entirety.

    This is not as difficult a problem to surmount as one might think at first.

    A well constructed specialty power of attorney that allows for self dealing and for gifting can be very important as a part of the plan that will allow for such a transfer if this transfer ever becomes possible.

    Careful attention to detail, and making sure that the transfer using the power of attorney  actually takes place when the time comes can also be crucial, of course.

    Alternatively, it may be possible to transfer the home to the care giving child through a conservatorship.  Although this is expensive, it is not as expensive as losing the house (or half of the house if there is a surviving spouse) to Medicaid recapture.