When a Spouse Has Dementia, Should You Change the Deed?

Removing a Spouse With Dementia From the Deed: Why Timing Matters

Removing a spouse with dementia from the deed is a question more couples are confronting as dementia diagnoses rise alongside an aging population. When one spouse experiences cognitive decline but remains listed on the family home, the issue quickly becomes more than emotional—it becomes practical, legal, and financial.

The question affects whether a family can sell the home, refinance it, borrow against home equity, or plan effectively for long-term care. In a recent conversation, elder law attorney Harry Margolis explained why, in many cases, removing a spouse with dementia from the deed is a step worth considering—and why acting early can make all the difference.

Why Removing a Spouse With Dementia From the Deed Comes Down to Control

At its core, the issue is control. As Margolis explained, the healthy spouse may eventually need to sell the home, refinance it, or access home equity to cover expenses. Those transactions are significantly easier when only one person holds title.

A power of attorney can sometimes allow the healthy spouse to act on behalf of a cognitively impaired partner. However, powers of attorney are not always sufficient. Some limit self-dealing or gifting, and state laws vary. Even when a power of attorney works, lenders and title companies often scrutinize these transactions more closely.

That uncertainty is why Margolis encourages families to consider removing a spouse with dementia from the deed as early as possible.

Why Timing Matters When a Spouse Has Dementia

If a spouse is in the early stages of dementia and still understands what they are signing, a deed change can often be completed relatively simply. Waiting too long can complicate matters substantially.

Once a spouse loses legal capacity, court involvement may be required. Families may need to pursue a conservatorship or guardianship before a deed change is allowed. In some states, this becomes a two-step process: first securing the appointment, then returning to court for permission to complete the specific transaction.

Margolis noted that some states allow a narrower option—a single-transaction conservatorship—that authorizes only the deed change. This approach can reduce ongoing court supervision and administrative burdens.

Medicaid Concerns and Deed Changes Between Spouses

Families often worry that removing a spouse with dementia from the deed could trigger penalties under Medicaid’s five-year look-back rule. For transfers between spouses, that concern is misplaced.

Margolis explained that Medicaid does not impose penalties for transfers from one spouse to another, making spousal deed changes very different from transfers to children or other third parties. More information on spousal protections can be found through Medicaid planning resources on Medicaid.gov.

That said, complications can arise if the home already includes a life estate, transfer-on-death deed, or Lady Bird deed. These arrangements often still allow spousal changes, but they require careful review to avoid unintended consequences.

Adding children to the deed is where families must be particularly cautious. In states without transfer-on-death deeds, creating a life estate gives children a present ownership interest. That is considered a transfer for Medicaid purposes and does trigger the five-year look-back period.

Why Deed Changes Should Trigger an Estate Plan Review

Margolis emphasized that removing a spouse with dementia from the deed should never be treated as a stand-alone decision. If the healthy spouse becomes the sole owner but dies first, an outdated estate plan could transfer the home back to the spouse with dementia—potentially forcing a sale and spend-down to cover nursing home care.

That risk highlights the need to review wills, trusts, beneficiary designations, and incapacity documents whenever a deed is changed. Estate planning guidance from elder law resources such as the National Academy of Elder Law Attorneys can help families understand how these pieces fit together.

Bottom Line

Removing a spouse with dementia from the deed is not about taking something away—it is about preserving flexibility, reducing risk, and planning responsibly. Small timing decisions can have outsized consequences, and what works for one family may not work for another.

As Margolis noted, details matter. Early, informed planning remains the most reliable way to protect both spouses and avoid unnecessary complications later.