Elder Law Answers
Is Transferring Assets to Qualify for Medicaid Against the Law?
You may have heard that transferring assets, or helping someone to transfer assets, to achieve Medicaid eligibility is a c...
Read moreIs Money Gifted to Me for Medicaid Planning Purposes Considered My Money?
- January 29th, 2018
Q
I have been asked to participate in a "note and gift" Medicaid plan for an aunt who has no other relatives. She is currently eligible for Medicaid and in a nursing home, but she recently inherited a large amount of money. The plan requires me to open a bank account in my name. I would use the account to make a monthly payment on a promissory note and pay the nursing home for the length of the penalty period. How does this account fit into my personal finances? Do I disclose the account if I'm asked for my personal financial information? If I don't disclose it, am I breaking the law?
A
You describe a Medicaid planning strategy available in some states and not others. For it to work, the nursing home resident needs to transfer the funds entirely to you, half as a gift and half as a loan. The result is that this is your money, even though you will be committed to paying back half. So you should report it wherever you are required to list your assets. However, the payments to you are not income so you should not report them as such. In addition, the promissory note is an obligation to pay on your part, so it would be listed as a liability if you are asked to list those as well.
Local Elder Law Attorneys in Ashburn, VA
Jeffrey Hammond
Hammond and Associates, LLC, Elder Law, Estate Planning, Wills, Trusts, Probate
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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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Jeffrey Hammond
Hammond and Associates, LLC, Elder Law, Estate Planning, Wills, Trusts, Probate
For Jeffrey Hammond, the practice of Elder Law is personal. Jeff’s many years of experience in law and in business did not prepare him for the crisis he faced in 2005 and 2006 when his father suffered a stroke and both of his parents suffered from dementia and other medical problems. At that time, Jeff began an i...
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John Laster
Law Offices of John L. Laster
John Laster is a lawyer licensed to practice in Virginia, Maryland and the District of Columbia. He limits his practice to wealth transfer planning, trusts, wills, powers of attorney, health care decision-making issues, estate administration and related tax, elder law and disability concerns. Listed in The Best Lawyers...
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