One of the most common questions we are asked in regards to qualifying for Medicaid is if assets can be given away to enable a loved one to qualify for Medicaid. The answer, in short, is maybe.
There are pretty severe penalties in place to prevent people trying to give away everything they own to qualify for Medicaid. For example, in Ohio, for every $5,247 given away during the three-year period before you apply for Medicaid equals a one-month period of ineligibility.
The Federal Gift Tax laws allow you to give away up to $12,000 each year without gift tax consequences, but the $12,000 limit could equal two months of ineligibility for Medicaid.
It is also not advisable to add family member’s names to accounts in an effort to qualify. The total amount of the bank accounts, savings bonds or certificates of deposits will still count, unless you can prove that one person on the account contributed the full value.
Luckily, there are a number of strategies a well-versed elder law attorney can put into play to help protect family financial security, and hopefully help your loved one qualify for Medicaid. In short, before you allow your elderly loved one to gift any property, money or valuables, consult with an experienced attorney. It could save your family from shouldering an enormous long-term care expense.
