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Can a Gift Be Returned in Order to Qualify for Medicaid?

  • August 27th, 2013
Q
My mother gave $30,000 away in 2008. She is now in a nursing home and will apply for Medicaid in about 12 months. Can we "give back" the money? If so, how is it done so as not to appear as a gift? She does not have the funds to cover a disqualification period.
A

Yes, you can return the money to your mother. This is known as a "cure" and, in effect, erases the original transfer for Medicaid purposes. And there's no problem with you making a gift to your mother. If each person is giving her $13,000 or less, it doesn't need to be reported. If anyone is giving more than $13,000, technically, it's supposed to be reported to the IRS, but with the newly passed tax bill, you'd have to give away $5 million before there'd be any tax.

Local Elder Law Attorneys in Ashburn, VA

Mindy Felinton

Felinton Elder Law & Estate Planning Centers
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Daniel Steven

Daniel N. Steven, LLC
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William Fralin

The Estate Planning & Elder Law Firm PC
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Last Modified: 08/27/2013

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