Elder Law Answers
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Read moreHow Can We Keep the Sale of Her House From Knocking a Nursing Home Resident Off Medicaid?
- December 29th, 2015
Q
A widowed, 82-year-old woman is currently in a nursing home on Medicaid and is up for renewal of her Medicaid eligibility. The woman’s house recently sold. We need to spend down the proceeds to Medicaid’s $2,000 asset threshold. She owned the home with her children, who all received their checks from the sale of the home. The capital gains taxes due from the sale of the house will not be paid before the renewal of Medicaid. What options do we have to keep an amount to cover the taxes and not be penalized? What options do we have to spend down? Is gifting an option? This is in Wisconsin.
A
We cannot comment on how Wisconsin will apply the law, but in most instances your mother cannot gift any of her share of the proceeds of the house sale. (Exceptions would include gifts to any of her children who may be disabled or into trust for the sole benefit of anyone who is disabled and under age 65.) On the other hand, your mother can spend her funds for her own benefit. This can include prepaying for her funeral if she has not already done so and prepaying her taxes. She can pay the IRS and the Wisconsin tax authorities an estimate of what she will owe for the sale of the house. But she can only pay for her share, not for any taxes that may be due on capital gain attributable to her children. An accountant should be able to advise on this.
To find a qualified elder law attorney in Wisconsin, click here.
Local Elder Law Attorneys in Ashburn, VA
Meet Loretta Williams
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Loretta Williams
Hale Ball Carlson Baumgartner Murphy PLC
Loretta Morris Williams is a certified elder law attorney by the National Elder Law Foundation. Ms. Williams was admitted to the Council of Advanced Practitioners, National Academy of Elder Law Attorneys (NAELA) in 2012. She serves as President of the Virginia Academy of Elder Law Attorneys. Ms. Willia...
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Ron Landsman
Ron M. Landsman, P.A.
Ron M. Landsman has been practicing elder law since 1983, before it was known as elder law, originally with Landsman and Laster, Washington, D.C., then Landsman, Eakes and Laster, also in Arlington, VA, and since 1990 in his own practice in Montgomery County, Maryland. He has been among the most active members of the...
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Meet Margaret O'Reilly
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Margaret O'Reilly
Margaret A. O'Reilly, PC
Margaret A. O’Reilly is an estate planning and elder law attorney with over thirty-five years of legal experience. Attorney O’Reilly graduated from Duke University with a degree in psychology, and received her law degree from Northeastern University School of Law in Boston, Massachusetts. For over 15 y...
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For more on the rules for spending down assets to qualify for Medicaid, click here and here.
Last Modified: 12/29/2015
