John T question

I know all the disclaimer stuff such as the laws in my area are the ones I need to be concerned with. An acquaintance's father has been diagnosed with a life threatening illness. Nothing has been done to this point in terms of estate planning relative to the son. The son seems to think he is in the clear 5 years down the road once a deed transfer is complete. I've been told that the 5 years does not matter if a serious illness is diagnosed ahead of the legal process as far as the government is concerned. The government will considered the transfer as an act of defrauding the government if the father goes on some kind of government assistance (nursing home). I just think the son needs to consider the possibility that the transfer could be undone in court if it gets to the point of needing government assistance. I was just wondering what others have seen in this situation. Not talking about my family by the way!

I think they have change that to 7 years now. But you are right.

You asked for it, so here is my totally unresearched yet still (based on no actual known detailed facts) professional legal opinion: NOTE absent a thorough in depth interview with the client and his or her goals and then research the most recent law MY OR OTHER OPINIONS OR EXPERIENCERS ARE PRACTICALLY WORTHLESS but it appears you already know that lol No harm in asking right?

YES INDEED A court "could" set aside a transfer of real property if it conflicts with or is determined to usurp or by pass Medicare/Medicaid laws and is NOT within certain "look back" time exceptions or its purpose is to defraud. YOU CAN TAKE THAT TO THE BANK.

HOWEVER that is NOT to say its not okay to give it a try provided there's no attempt to defraud. I tell my clients THE SOONER THE BETTER when it comes to gifting or spend down in order to qualify someone for Medicare/Medicaid. If it fails for Medicare/Medicaid SO BE IT a Court may set it aside..........If it fails as an attempt to defraud SO BE IT a Court may set it aside..........But if you sit and wait you could be squandering valuable precious time towards any look back time periods IE best to do it now then wait (provided not to defraud). NOTE IM NOTTTTTTTTTTTTTT REPEAT NOTTTTTTTTTTT condoning or advising any conveyance for fraud purposes, Im ONLY saying the sooner the better if the intention is to get it done prior to any look back provisions are concerned.

NOW LISTEN ALL Medicare and Medicaid is one THE MOST difficult to understand and ever changing areas of the law. While I practice in the areas of estate planning I DO NOT hold myself out to be a Medicare Medicaid specialist. Those are highly specialized areas of practice and I would NOT advise you to hang your hat or bet the farm on what Billy Bob or Bubba or even experienced attorneys have to say who are NOT Medicare Medicaid SPECIALIST. What others have done or others have experienced will mean absolutely NOTHING if this person is challenged by Medicare or Medicaid or is charged with fraud.

NOTE This is NOTTTTTTTTTT any opinion as to the merits or morals of an older person gifting or conveying property within time limits in order to qualify for government assistance REMEMBER ITS US TAXPAYERS WHO PAY IF THEY DONT. Take those social or political arguments elsewhere, Im NOT offering an opinion either way.

Spend down and gifting and conveyance is a tool and method used by people in order to qualify for government assistance be it good or bad in your personal opinion. IN GENERAL the sooner the better provided its NOT to defraud, that's my best free unresearched opinion, take or leave it at your own peril, like or not like the system as you please, other personal experiences and opinions isn't worth much in a Court of law. As always and the poster acknowledged, CONSULT A PROFESSIONAL SPECIALIST is my advice and DO NOT rely or bet much on non professional non researched opinions, lay or professional.

John T BSEE, JD Country Lawyer in Indiana

The son needs to consult with an attorney specializing in "elder law".

I doubt that is going to happen as the family is rather bull headed to start with. The thing I am hearing is sometimes these transfers get voided even after 6,7,8 years or more if evidence existed of a serious health issue prior to the transfer. Obviously, at some point the whole thing reaches a gray area if nothing happens after several years. It just seems trouble can lie ahead even at years 6 through 8. I have not heard of a DA going after an estate 10 years after the transfer but who knows.

You're a whole lot more of an expert than I am on the subject since I claim absolutely no expertise in that field at all,but from what I've seen on Board of Review with property transfers and with what my wife has seen first hand with her experience in home health care,isn't putting the whole place in a trust sometimes the best option?

He won't be in the clear if he runs around and tells everybody in town about it, otherwise I doubt if the federal government will ever hear about it, almost all nursing homes are run by experienced scammers and they want the Medicaid money more than they want the old mans money, the government pays more than they can get away with bleeding out of a private citizens personal funds. When the old gent croaks and the boy inherits he does not have to report anything as long as it is not above the federal death tax threshold which is pretty high right now. I personally believe that if people choose nursing homes or hospices etc. they ought to be willing to pay for it if they have the money or assets and not Palm it off on the tax payers, but on the other hand the old man probably paid a good bit of taxes over the years that he got nothing out of so it may all work out even.

It can be an option, depends on a revocavble versus non revocable trust and the terms and purposes, yet there are other just as good options.

John T

All the more reason as I mentioned below THE SOONER THE BETTER then let the chips fall.

John T

AMEN

John T

If an insurance company or annuity is involved they will check medical records to see if he knew about the illness before buying the policy or annuity.

We went the revocable trust route. Seemed to be the best option.

John T I was told there is a much better chance if say the old person sold it to an outsider or a corperate. AND SOLD IT AT FAIR MARKET VALUE vrs selling a farm for $10,000 to a son???

Good question. A sale to an outsider especially at fair market price indeed appears more legitimate and doesnt arouse suspicious, however, that in part defeats the purpose of any spend down since the seller then has the money. One purpose of disposing or property (provided NOT to defraud) is to protect it from creditor or government liens or attachments and hopefully the child (not the Government or creditors) might end up with it after x number of years.



John T

There is law in some jurisdictions that in a revocable trust if the trustee is the Medicaid recipient he or she still has the money in effect since they as the Trustees can draw it out if necessary (IE they have the power to revoke or could be court ordered to do so) to make payments. It may or may NOT survive scrutiny.

John T