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A Case Where Transferring the Home to a Child Makes Sense
I have been caring for both my mother and father for about four years. I live in their home in Alabama. My mother has severe COPD and my father has dementia. My concern is how would it affect their jointly owned home if one of them has to be placed in a nursing home (they still have a mortgage). What needs to be done to protect the home if one or both of them have to be placed in a nursing home?
It probably makes sense for your parents to transfer the house to you. Usually such a transfer can cause up to five years of ineligibility for Medicaid coverage. However, it sounds like you would qualify for the so-called “caretaker child” exception to Medicaid's rules governing the transfer of the home. In most states, to qualify for this exception you need to get a letter from a doctor saying that for at least the past two years were it not for the care you provided to your parents, they would have had to move to a nursing home. That said, since every state interprets these rules differently I strongly recommend that you consult with an Alabama elder law attorney.
For more on Medicaid's asset transfer rules, click here.