Answering Your Questions: What Are the Risks of Adding My Mother’s Name to My Bank Account?

This edition of the Koldin Report E-Newsletter is part of a series on questions we received from our "contact us" form on our website about Elder Law, Estate Planning and Medicaid.

All prior newsletters are saved on our website. You can read them by clicking here.

QUESTION: I am a single adult and my mother and I added each other’s names to our bank accounts as joint owners. My mother now needs nursing home care. What happens to our joint bank accounts?

People often create joint bank accounts for 3 main reasons. (1) To allow the other person to be able to assist with paying bills. (2) To avoid probate. If one co-owner dies, the other co-owner continues to own the entire account. (3) To combine funds and share expenses together, which is common among spouses.

Under the Medicaid law, the entire joint bank account is deemed to belong to the person in the nursing home and must be spent towards the cost of care before Medicaid eligibility can be established.

There are ways to possibly challenge this by showing that all of the funds in the account were contributed by the son and that no funds from the account were ever used towards the mother’s expenses. Costly litigation could become necessary.

Some Courts have held that with proper evidence, a Joint Account can be classified as a "Convenience Account" where the joint owner was added solely for convenience purposes.

A child who desires for a parent to have access to his/her account for convenience purposes could either sign a Power of Attorney naming the parent as his Agent or he could establish a Revocable Trust and name his parent as a Co-Trustee.

For more information about the Medicaid laws, please see our website by clicking here.

At the Koldin Law Center, P.C., located in East Syracuse, New York, we have over 50 years of experience helping individuals plan for immediate crisis and long term care. Our attorneys are available to discuss your estate planning options. We do not charge a fee for the initial consultation. We welcome your children, family attorney, accountant, and/or financial planner to be present at the initial consultation.

There is something you can do.

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Our Attorneys speak to groups throughout New York State as a public service. If you would like to arrange for one of our Attorneys to speak to your group, please contact our office.

We appreciate your referrals

We have been told by many clients who are in a crisis that they wish they had known about our firm much sooner. We are proud of the many families we have helped in times of crisis.

We are also proud of the many families we helped avoid financial crisis by doing estate planning in advance.

We all share the responsibility for making our family and friends aware of the planning options available to them.

Your referral to the Koldin Law Center could make a major difference in the lives of your family and friends if they are someday faced with a long term illness.

Remember that the Koldin Law Center offers many services for clients of all ages. Our services range from basic estate planning such as a simple will to complex estate planning including asset preservation planning.

THERE IS NO FEE FOR THE INITIAL CONSULTATION