How do i give my son a House the "right" way?

[Gworker]

My parents put a Time Of Death rollover on their house papers. When they died it rolled right over to my brother and I and we sold it almost immediately, thus avoiding any profit. It was easy.

[maddythebeagle]

I know one older lady that just went into a nursing home at 92...she had transferred her property to her son years ago and he was paying the taxes and letting her stay in the house...one problem that I saw was it gives a lot of control to the kids...and frankly, I think there are different levels of homes and going in as an indigent might not be the most desirable just so your kids can squander your hard earned money....

[Martha]

To expand on the basis issue, one advantage of simply leaving him the property in your will is that when you die he will be able to calculate depreciation of the investment property off of the value at death. And your estate will not have to recapture any depreciation you took and pay taxes on it.

I know you don't want to see no stinking lawyers, but when the time comes to make decisions I would see an estate planner. You or your heirs may save a lot more money than it will cost. Also, I have no idea if you want or need to do any medicaid planning, but it is a dangerous area fraught with issues that are best left to the experts.

[In-control]

Talk to a lawyer - especially one dealing with real estate. We re-did the deed of my mothers house so when she passed it transfered to me automatically. It must be done prior to the person passing though.

[twaddle]

Quote:

Originally Posted by Martha Also, I have no idea if you want or need to do any medicaid planning, but it is a dangerous area fraught with issues that are best left to the experts.

I think there was a time when it was illegal for lawyers to offer medicaid "planning" advice. Is that still the case?

[Martha]

Pretty much sorta kinda.

[Caoineag]

Quote:

Originally Posted by twaddle I think there was a time when it was illegal for lawyers to offer medicaid "planning" advice. Is that still the case?

In theory but not in enforcement. There is a lot more to it than just it is or it isn't but the end result is there are attorneys that help people "plan" for medicaid.

If your state does beneficiary deeds, you might want to look at that.

I would still recommend an estate planning attorney. If you are worried about being nickeled and dimed to death, look for an attorney that does flat fees (usually initial consultation is free so they can figure how complicated your case is).

My disclaimer, I do NOT offer legal advice of any sort.

[Milton]

Quote:

Originally Posted by travelover There is a big difference in my mind between saying you could ditch the assets and you should ditch the assets. This lawyer recommended the latter.

A decent lawyer is not afraid to make specific recommendations. Merely listing options in a wishy-washy sort of way is inadequate legal advice.

[Enuff2Eat]

Does lawyer actual understand the difference between Moral and Legal?? oh well, i guess i can ask the same question about politicians..

[Milton]

Morality is extremely subjective. The law is (relatively) objective.

Lawyers are supposed to be dispassionate professionals. Their individual ideas of morality should not be (explicitly or implicitly) imposed upon their clients, who must remain free to make their own decisions. The same holds true for physicians, BTW.

[travelover]

Quote:

Originally Posted by Milton A decent lawyer is not afraid to make specific recommendations. Merely listing options in a wishy-washy sort of way is inadequate legal advice.

"Sure there was a witness, but he might be convinced not to testify..."

[Milton]

I give up.

Obviously you hate lawyers and believe they are all immoral cheats and liars. You're entitled to your bias opinion.

I can only suggest that in the future, you never again seek legal advice. That will save both you and the lawyer from an unhappy relationship.

[Martha]

Interestingly, though many people dislike lawyers in the abstract, they usually like their own lawyer. It is not just the quality of advice, it is a relationship.

[REWahoo]

Quote:

Originally Posted by Martha Interestingly, though many people dislike lawyers in the abstract, they usually like their own lawyer. It is not just the quality of advice, it is a relationship.

Yep. He/she may be a SOB, but they're my SOB!

[travelover]

Quote:

Originally Posted by Milton I give up. Obviously you hate lawyers and believe they are all immoral cheats and liars. You're entitled to your bias opinion. I can only suggest that in the future, you never again seek legal advice. That will save both you and the lawyer from an unhappy relationship.

I don't hate lawyers. I do think that people that try to stash their money so they can push their nursing home costs onto the taxpayers are ethically challenged.

Although from what I've seen of Medicaid nursing homes, they will get their just reward in the end.

[retiringby50]

A few thoughts... next week I will be paying estimated taxes on a house that I "inherited" and sold... over $41K because I was given 1/2 of it before my dad passed away. I'm an only child. The house was owned jointly by my mom and dad, but mom died about 15 years ago. Before she died, she made him promise to give her 1/2 of the house to me. As an added protection, a few years later, I added my name on the deed as joint tenant. My dad was in his early 80's at the time. Although in good health, he had a way of threatening to do things... "you didn't go to the grocery store for me like I asked; you're going to inherit everything, you know. You should at least listen to me!" or "You're just waiting for me to die! I should give the house to someone else!" Then he got remarried! And later divorced! You get the picture. I knew it was not a wise financial decision but did it anyway "just in case." My dad had gotten married again in hopes of having a male heir. :confused:

To the OP, I know plenty people who have given away everything so that their assets wouldn't go to the nursing home... I personally wouldn't do that because of the trust issue... if my child squanders my money, I'm truly left with $3,000 to my name (or whatever the limit is!). No matter how well you raise them, you just can never be sure. Also, the government-chosen nursing homes aren't the best (there's a reason why they're the cheaper ones). I'd rather ensure my last days are in a nice place, somewhere I chose ahead of time if possible...

[rs0460a]

Quote:

Originally Posted by retiringby50 Then he got remarried! And later divorced! You get the picture...

Since you bring up the subject, I had a similar situation.

My parents were divorced after 25+ years of marriage (surprised it lasted that long ).

Both remarried. Of course, you know where the "inheritance proceeds" went to (hint - the "second family").

I learned at an early age not to count on relatives to "fund" your life. Go your own way, make your own (financial) life, and you never will be disappointed.

Good advice to myself. I followed it, and am better off financially than if I would have counted on any inheritance .

- Ron

[ChrisC]

Quote:

Originally Posted by travelover I don't hate lawyers. I do think that people that try to stash their money so they can push their nursing home costs onto the taxpayers are ethically challenged. Although from what I've seen of Medicaid nursing homes, they will get their just reward in the end.

This is an interesting thread to me as a lawyer, with a mother in a nursing home, having retained an elder care lawyer to help probate my father's dormant estate, having my mother's modest savings exhausted by nursing home bills, and having had to deal with Medicaid, directly and with the assistance of our elder care lawyer.

If you think Medicaid will permit anyone to play a shell game with assets or asset transfers, permit you to keep assets that might be used to pay for nursing home care, or won't slap a lien on a recipient's primary residence at probate of the recipient's estate to recoup nursing home costs that Medicaid paid -- you're badly mistaken.

Sure, there are cases of outright fraud involving the willful hiding of assets and hidden transfers, but the Government generally will require you to be penniless before you receive Medicaid assistance and the most exacting and prudent "Medicaid planning" won't prevent the Government from getting exactly what it wants from an applicant or recipient. Generally, transfers of assets made by an applicant within 5 years of the date an applicant files for assistance will be 'recaptured' by Medicaid in determining eligibility.

Your lawyer simply appeared to advise you about making transfers before an application were made to Medicaid, which would have been taken into account by Medicaid if within the "look-back" period, which used to be 3 years but is now 5 years. This is advice which is hardly unethical or immoral -- he was just stating what the rules permit.

BTW, skilled nursing facilities do not generally discriminate between Medicaid or non-Medicaid recipients, at least that's been my experience in NYC. The highest rated skilled nursing facility in the entire State of New York primarily has lots of Medicaid patients.

Regarding the original post about the transfer of a piece of real estate, others have pointed out the stepped-up basis that occurs through inheritance of the property -- I believe that this can also be achieved transferring the property (deeding it over) but retaining a life estate in the property.

[travelover]

Quote:

Originally Posted by ChrisC ............... Your lawyer simply appeared to advise you about making transfers before an application were made to Medicaid, which would have been taken into account by Medicaid if within the "look-back" period, which used to be 3 years but is now 5 years. This is advice which is hardly unethical or immoral -- he was just stating what the rules permit. ..................

The interface with the lawyer that I referred to was about 15 years ago, prior to current laws about look-back (which were passed to stop this practice). He was clearly advising to pass on the small estate to other family members immediately, so Medicaid would pay for the nursing home expenses. You may not consider this advice unethical or immoral, but I do.

Re the quality of Medicaid nursing homes, my anecdotal experience is that if you get into a good one with private pay you may stay on via Medicaid once your funds run out. If you try to enter one on Medicaid, you may well be refused. Again, just my observation.

[Martha]

The big issue with the 5 year look back is that people who might have received assets might not have them anymore.

Quote:

Originally Posted by ChrisC Regarding the original post about the transfer of a piece of real estate, others have pointed out the stepped-up basis that occurs through inheritance of the property -- I believe that this can also be achieved transferring the property (deeding it over) but retaining a life estate in the property.

Yeah, I think so too. Maybe a joint tenancy as well. I wonder how the life estate would play out when you are transferring rental property. The life estate holder would be the one to lease the property out and collect the rents, which might not work for the OP. I don't know how the depreciation would be affected.