How Can I Protect My House From Medicaid Estate Recovery?
When a Medicaid recipient passes away, their house becomes at risk of being possessed by the state. The reason being that the state will attempt to recover whatever Medicaid benefits the recipient received, which in most cases is solely their house.
In order to avoid Medicaid estate recovery from possessing your house, you will need to ensure that your property does not fall under probate. Probate is when the state handles the distribution of your estate after you pass. To do this, you will need an elder law attorney to help navigate the best possible solution for you.
Here are just a few of the ways you can protect your house from Medicaid estate recovery:
- One way to avoid your home being possessed in Medicaid estate recovery is to set up a “life estate without powers”. A life estate allows you to add one or more people to the names on your property. Which effectively makes them joint owners of your house. The holder of the life estate remains the owner of the property for the rest of their life and then it is passed onto the next owner after they die. The “joint” owners you choose to own the house with you will not have control until after you pass.
- You also have the option to gift the house to relatives or loved ones. Although, this comes with tax implications and is often not the best choice financially or practically.
- In select situations, you may consider setting up a trust. However, please be aware that trusts are not necessarily the best way to protect your house from Medicaid estate recovery. In this instance, trusts are very nuanced and you must consult with an elder law attorney to see if it is a viable option for you.
There are several ways to protect your house from Medicaid estate recovery, so it is best to consult with your elder law attorney so they can help you determine the best option for your specific situation.
If you have any questions regarding estate planning and Medicaid estate recovery, please contact us today at firstname.lastname@example.org or 410-296-6777. We would be happy to assist you and answer your questions.