If someone left me a house when they died, can I live in it without losing Medicaid eligibility?
Someone died and left me house I knew nothing about. Can I keep it so I have somewhere to live
In my experience working with seniors to access programs and services for about 10 years, the answer is maybe and no. I say maybe if you are not the only owner of the house. For example, if this house was left by an aunt to you and your siblings, you are not the sole owner of the house and I believe Medicaid would not count this asset. On the other hand, if you ARE the only owner, then the answer is no and they would count that as an asset. I am not an expert, but that is my view.
Great question and one that many people have.
There are a couple components to the answer. Let's take them one by one.
- State Rules - Medicaid is a Federal-State program so its rules vary by state.
- Cost of Home - The home has to be valued below $500,000 ($750,000 in a few states)
- Home Rules - As long as the home is your primary residence and you intend to live there for as long as you can then it is exempt from Medicaid restrictions (it is deemed an "exempt resource"). This means you cannot own your previous home at the same time. Also if you go away to a nursing home you have to sign a document stating that you intend to come back to the residence.
- Capital Gains - You may need to pay capital gains taxes on the increased value of the home since it was first purchased. This can be a significant outlay of cash.
- What will happen to the home - After you pass the home will be put up for sale and the proceeds will go back to reimburse Medicaid. This is unless a child cares for you for two years and as a result prevents you from having to go to a nursing home. The house could then be pass to that individual upon your passing without penalty.
For specific rules and regulations in your state I would recommend contacting an Eldercare Law Attorney.