Newsday: Ask the Expert June 2, 2007
Ask the Expert: Wendy H. Sheinberg, Esq
Home transfer in Medicaid
The problem: My 91-year-old father gets community Medicaid and owns a Queens apartment. Eighteen months ago, my brother moved home to take care of him. If my father needs a nursing home, can my brother stay in the apartment, or will it have to be sold to pay Medicaid?

The expert: Wendy H. Sheinberg, elder law attorney, Sheinberg & Associates, Garden City.

The rules: The Medicaid Nursing Home Care program allows a parent to transfer his primary residence, without penalty, to a caregiver child who has lived with the parent for at least 24 months before the parent is admitted to a nursing home.

The strategy: Your father should transfer the apartment to your brother now. If he requires nursing home care within the next six months, the transfer would not be exempt, but other planning strategies could help. How it works: Since your father is receiving community Medicaid, an ownership transfer is prudent, even if your father never needs nursing home care. New York Medicaid estate recovery rules give the government a right to recover Medicaid benefits paid to recipients over age 55 after they die. However, this right of recovery is limited to the probated estate. If the apartment is transferred during your father's lifetime, it will not be part of your father's estate, and thus not subject to estate recovery. The transfer of the apartment will require the filing of a federal gift-tax return. As long as your father has not made more than $1 million in taxable gifts over his lifetime - including the value of this apartment - no gift tax will be due. If the apartment is a co-op, board approval will likely be required before the apartment can be transferred. Depending on how the apartment is transferred, your brother may lose certain real estate tax exemptions that your father was allowed. The results: Your father's apartment does not have to be sold. Consult with and follow the advice of an experienced elder law attorney who can give you alternative solutions. 
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