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Will I Lose My House if I go to a Nursing Home?


hey guys Mike Frontera here back with

 another retirement Theory video so Mike



 what happens to my home if I need

 long-term care does Medicaid take it



 this is a question I get with some

 regularity and like many things legal or



 financial the answer depends on a few

 crucial factors so I'm gonna go over



 these factors and some things that you

 can do ahead of time to protect your



 home now before we delve in a quick

 caveat I'm not an attorney state laws



 vary considerably and nothing I am about

 to discuss is legal advice okay and



 today we're only dealing with your

 primary home I'm not addressing the



 protection of any other assets during a

 long-term care need in this video so



 let's start out with some good news that

 is if you are receiving Medicaid and you



 are still living your home will

 typically not be sold to pay for your



 care while most of your other assets

 must be spent down in order to qualify



 for Medicaid your primary residence is

 an exempt asset an important little



 asterisk though is that when you enter a

 nursing home you must provide them with



 a written statement that declares your

 intent to return home at some point the



 neat thing is that your spouse will also

 not get kicked out of your home after



 you pass away so if you have no kids and

 you don't care what happens to your home



 after you're gone you can probably stop

 watching but it is good cocktail party



 fodder so you might want to watch anyway




 then when would Medicaid typically force

 the sale of your home well if you're



 single or widowed and your receiving

 assistance it would happen after you



 pass away and if you're married and

 receiving assistance it is a bit more



 complicated again assuming you have

 declared an intent to return home and



 either you or your spouse is still

 living estate recovery typically does



 not occur once you have both passed if

 your spouse hadn't



 received Medicaid assistance than a state

 recovery on your home is only done



 sometimes and only in some states now if

 both of you have received Medicaid



 however then recovery through a forced

 sale is more likely so for people who



 want their home to pass to their heirs

 someday there is then some risk of an



 eventual forced home sale should they

 receive Medicaid assistance so what are



 some things that can be done to reduce

 that risk okay let's start with the



 solid ones if you leave your home to

 your child who's under age 21 or to a



 child who is blind or disabled States

 will not go after it at least under



 current law that's something that

 probably still won't help a lot of



 people the next one's a bit tougher if

 you have a child who lives with you and



 has lived there at least two years prior

 to you needing nursing home care and



 they can show to the state to their

 satisfaction that they kept you out of a



 nursing home longer because of their

 help then Medicaid may not try to



 recover the home from them after your

 death for those with no children living



 at home you may want to see if your

 state allows recovery from both probate



 and non-probate assets in those that do

 not simply having your home passed



 outside the scope of your will in thus

 outside of probate could do the trick so



 let's look at three ways to do that

 because in many cases avoiding the time



 and expense of probating your assets in

 your will is beneficial enough to do



 anyway so one way to have your home pass

 outside your will would be placing it in



 a revocable living trust now it's

 important to note that a living trust is



 one where you typically retain full

 control of the asset these trusts are



 not the same as irrevocable trusts and

 are often established to hide assets to



 qualify for Medicaid sooner that's an

 irrevocable trust okay



 another technique that can work to move

 your home outside of your estate is



 setting up something called a ladybird

 deed now currently ladybird deeds are



 only allowed in five states Florida

 Michigan Texas Vermont and West Virginia



 a ladybird deed basically names

 beneficiaries to your home but you still



 have the right to live there and control

 the property it doesn't create a five



 year look-back period for Medicaid

 eligibility and it has the potential in



 keeping the home in the family in those

 states that allow it a more common



 version of this is what's called a

 transfer on death deed a transfer on



 death or a Tod deed can be another

 relatively easy way to have your home



 passed outside of your will these Tod

 deeds are available in a lot more than



 five states but not every state so the

 caveat here is that just because you can



 set one up in your state does not

 necessarily mean it will protect your



 home from Medicaid estate recovery some

 states as I said before allow for these



 deeds but we'll go outside of your

 probate estate in their recovery efforts



 finally you could consider whether it

 was worth transferring your home to an



 irrevocable trust this would have the

 effect of removing your home from your



 possession for Medicaid purposes in fact

 many other assets could go in there as



 well like investments in cash and may

 keep them from having to be spent down



 during your lifetime in order to qualify

 for Medicaid but doing this could



 subject you to a five-year look-back

 period for Medicaid eligibility meaning



 if you needed care within five years of

 making this transfer you may have a



 period of ineligibility to satisfy

 before benefits were available in fact



 there are a number of drawbacks but also

 significant opportunities to these



 irrevocable trusts but that is starting

 to get way out of the scope of this



 video so we'll save it for another time

 now if you've been listening very



 carefully you might have noticed that




 many qualifier words I've said here a lot

 of mights and mays and under current law



 it's because these laws are continually

 in a state of flux and what worked today



 may very well not work tomorrow and

 because laws and enforcement of these



 laws varies tremendously between states

 so let me finish with this reminder if



 this stuff's important to you I

 encourage you to visit within an estate or



 elder law attorney early on and review

 your plans with them regularly if you



 want to find out more about working with

 me come visit me at www.retirementtheory.com



 or give me a call at (518) 667-2022. Did you hit the subscribe button or follow me on Facebook I think that you should You'll stay up to date on my videos on all things retirement planning once again thank you for joining me see you next time


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