How Transferring a House Affects Medicaid Eligibility: Transferring your house to a descendant like a child or niece can make you ineligible for Medicaid for a period of time. This is due to Medicaid’s “lookback period” which reviews asset transfers made in the 5 years prior to applying for Medicaid.
The length of Medicaid ineligibility depends on the value of the house. A more valuable house leads to a longer period of ineligibility.
There are some exceptions – transferring a house to a spouse will not affect eligibility. Transferring to a properly structured trust may also avoid penalties.
The transfer must be a legitimate gift or sale for fair market value. Sham transfers will lead to Medicaid ineligibility.
Even if you qualify for Medicaid while owning a home, the state can still place a lien or try to recover assets from the home after death. Transferring the home may not fully protect it.
Work with an elder law attorney if considering transferring property to make sure you understand the implications on Medicaid eligibility before proceeding.
There are other options like special needs trusts that may better protect assets like a home rather than gifting it directly to heirs.
In summary, transferring a house can often lead to loss of Medicaid benefits for a period of time. Consulting with an elder law specialist is highly recommended to understand options. Watch more videos about Medicare on finStream TV at this link: https://www.finstream.tv/videos/medicare/
Categories: Healthcare, Real Estate Investing