Protecting the Family Home for the Community Spouse and Family
This edition of the Koldin Report E-Newsletter is part of a series on Frequently Asked Questions About Medicaid.
All prior newsletters are saved on our website. You can read them by clicking here.
In this newsletter we answer the following question:
If my husband is going to a Nursing Home, can I keep my family home?
When the at-home spouse (Community Spouse) is living in the home, the family home is exempt and is not counted as an asset when determining Medicaid eligibility for nursing home care for the institutionalized spouse.
Don’t Keep the Home Owned Jointly Between Spouses
The first mistake families make is to leave the home owned jointly by both spouses. If the community spouse unexpectedly dies first, the institutionalized spouse would automatically become the sole owner of the home.
Since there is no longer a community spouse living in the home, the family home loses its exempt status and becomes an available resource and could be lost towards the cost of care.
Typically, upon inheriting the family home, the Medicaid recipient would have his/her Medicaid case terminated and the home would have to be sold and the proceeds spent towards the cost of care and then once the balance is spent, then he/she would have to reapply for Medicaid.
Therefore, when one spouse needs long term care, they should not leave the home jointly owned.
Since there is no transfer penalty period of ineligibility between spouses, the ill spouse can transfer his/her one-half ownership of the home to the community spouse. Now, if the community spouse dies first, the institutionalized spouse would not automatically become the sole owner of the house.
Community Spouse Needs to Update His/Her Will
If the home is transferred to just the community spouse’s name, then if the community spouse dies first, the home would pass according to his/her Last Will and Testament.
Since spouses often have Wills leaving everything to each other, it is important that in addition to transferring the home to the community spouse, he/she also sign a new Will removing the institutionalized spouse as a beneficiary.
False Sense of Security: Family Home is Still Unprotected if the Community Spouse Becomes Ill
Although revising the community spouse’s Will would prevent the institutionalized spouse from inheriting the house, it does not protect the family home if the community spouse later becomes ill and needs nursing home care. The family home could be lost towards the cost of care for the community spouse.
Therefore, the Community Spouse may want to consider taking further steps to protect the family home.
The community spouse should consider asset preservation estate planning for himself/herself including purchasing long term care insurance and/or establishing an Irrevocable Living Trust.
For a discussion about Irrevocable Trusts, please visit our website by clicking here.
If you are already ill, even if you are already in a nursing home, there are asset protection options available. However, once you spend your life savings towards nursing home costs, there is no way to get the money back.
For a discussion about how to protect your life savings even if you are already in a nursing home, please visit our website by clicking here.
The Koldin Law Center, P.C. is available to help. We assist families in protecting their life savings even when someone is already in a nursing home.
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. When the Koldin Law Center, P.C. handles a Medicaid case, we not only handle the entire application process, but we also review asset protection options with our clients. We review with our clients who are already in a Nursing Home options to protect some or all of their assets beyond merely establishing Medicaid eligibility. 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.
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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.
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We all share the responsibility for making our family and friends aware of the planning options available to them.
Your referral to the 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 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.
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