The Elder Law Forum

The Elder Law Forum Joint Ownership, Harleys and Ocean Cruises By Michael Myers
USD School of Law Owning property jointly contains risk. Each owner can spend or deplete the joint account or property.�?  For Medicaid planning purposes, however, joint ownership can be advantageous. I received the following email:�? â�?�?I am 73 and an only son.�? My mother is 92 and in a rehabilitation facility.�? Her only assets are as follows: House in both names; two CDs in both names, and checking account in both names. â�?�?If she applies to Medicaid what will they be entitled to?â�? My response: â�?�?Medicaid will take the position that your mother has an undivided one-half interest in jointly-owned property and, assuming you are not disabled and do not reside in the home, will treat one half the value of the home, the CDs and the checking account as â�?�?countable assetsâ�? and must be â�?�?spent downâ�? prior to her being eligible for Medicaid.â�? â�?�?At the same time,â�? I advised, â�?�?you have access to those assets and may in the ordinary course of living use those assets for your own purposes as long as they are not accessed for the specific purpose of triggering eligibility for Medicaid,â�? adding: â�?�?Medicaid will take a financial snapshot of your motherâ�?�?s assets and income at the time of her application for benefits. You and your mother should consider minimizing the value of your jointly-owned property prior to considering an application for Medicaid benefits.â�? Their joint ownership was established in 1998, well before Medicaidâ�?�?s five-year â�?�?lookbackâ�? rule pertaining to the gifting of property.�? Accordingly, both the son and his mother have unfettered access to the homeâ�?�?s equity and monies in their checking account.�? Legally, he could empty their checking account and purchase a top-of-the-line Harley-Davidson, or a Chris-Craft cabin cruiser, or gamble it away.�?  Such expenditures would not constitute a â�?�?transfer of assetsâ�? and would not trigger a â�?�?penalty periodâ�? whereby Medicaid withholds benefits for a period of time determined by the value of the transferred asset. He owns an undivided interest in their assets; and so does she. If able and so inclined, she could empty their accounts and take a last-in-a-lifetime ocean cruise.�?  The CDs could pose a problem, if their liquidation requires mutual consent.�?  Jointly held property, particularly for non-spouses, can be a valuable planning tool. But it must be used 60 months before approaching the Medicaid benefit table. Otherwise you may have to forego the Harley. (Pro bono legal information and advice is available to persons 55 and older through the USD Senior Legal Helpline, 1-800-747-1895;�?  Opinions solely those of the author and not the University of South Dakota).

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