Can I Give Away My Assets To Receive Medicaid Benefits?
In order to qualify for Medicaid, which is a public health care program available in the United States, a person applying must meet certain income levels which includes property, income, stocks, and so forth. Some people try to give away assets to family and friends. This is basically done in order to ‘hide’ their resources hoping that this will then qualify them for the program.
What Is Considered A Gift When Applying For Medicaid Benefits?
Under Medicaid guidelines, any liquid asset or income you give away is considered a gift. An example: you own a summer cabin that you give to your son. This is considered a gift because this cabin could be sold at value. The money from the cabin would be considered as income. Items such as cash gifts, bonds, and so forth, when given away are also considered gifts. Such items as clothing, dinnerware, books, and so forth can be given as a gift as these probably would not have much monetary value.
The Deficit Reduction Act of 2005 Was Established To Counteract Gift Giving To Qualify For Medicaid Benefits
The Deficit Reduction Act was established to counteract giving gifts in order to hide assets. It also increased the stringency of the rules under Medicaid. This act is particularly directed at people entering nursing homes to make certain they do not give away gifts in order to have Medicaid benefits to cover their monthly costs. Any potential resident in a nursing home, applying for Medicaid benefits, is required to go through a five-year “look-back period.” Any home transfers, or the transfer of bank accounts and so forth, are reviewed. Anything transferred during the five year period is subject to evaluation and if there is any indication that property was transferred at less than its value this is considered as a fraudulent act.
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