Should I Retitle my Deed to Protect my Parents House from Florida Medicaid or the Nursing Home?
When parents get close to the time to transition to an assisted living situation, the family starts to worry about the status of the family home. Will Medicaid swoop in and sell the home to pay back whatever expenses it paid for the parents? Is there anything the kids can do to prevent the family home from being lost to Medicaid? These are good questions, but all too often the answers people come up with are wrong and dangerous.
“I Know! Mom And Dad Will Sign The Title Over To Me!”
There are two things you need to be careful of when it comes to Medicaid applications. The first is making any decisions that involved a lot of money without first talking to an experienced attorney. The second thing to keep in mind that, as a general rule, Medicaid does not like gifts.
When your parents sign their house over to you just before going into assisted living to try and avoid Medicaid taking the house, Medicaid will probably take the house anyways. There are other potentially damaging consequences of this action that you need to keep in mind as you are trying to sneak the family home in under Medicaid’s radar.
This Is An Income Tax Event
When your parents sign over the title of their home to you without your parents getting anything in return, then the IRS looks at it as a taxable event. Not only are you now dealing with a potentially huge tax bill, but that tax event could also have repercussions with your parent’s Medicaid application.
What About The Rest Of The Family?
A rash decision like this that is usually made without consulting the rest of the family could result in breaks in the family that may never heal. Your siblings might wonder why they were not gifted the house, or they may wonder if you might be trying to cheat your parents. Your uncle might have built that home for your parents and your parents might have had a verbal agreement in place with your uncle for that property when your parents passed on. Trying to transfer the title of a family home to avoid Medicaid charges without first inviting family discussion could be catastrophic.
If Medicaid sees your retitling of your parents house as a gift, then that could delay the approval of your parents Medicaid application by months. Instead of making a decision like this on your own, we encourage you to contact our legal team and get experienced legal advice first. Our professional elder law attorneys will explain your options to you and help you to understand the best ways to possibly prevent your parents home from being liquidated by Medicaid.