How Do I Protect My Home from Long Term Care Costs?
Hi, I am Ken Kraus. I am one of the attorneys at Evans Fox in Rochester, NY.
Today we will address how to protect your home from long term care costs.
First, the context … long term care is very expensive, in some cases more than $18,000 per month. If eligible under Medicaid’s rules, then you may not have to privately pay this cost.
But will Medicaid require you to sell your home to be eligible?
No, if your spouse is living in it. In this case, Medicaid considers a primary residence worth less than approximately 1.0 million dollars to be an “exempt asset”. This is great news, and if you’re only worried about protecting the house for your spouse, you may not need to do anything.
However, if you want to protect your home for the benefit of your heirs, then you may consider starting the “5-year clock” by gifting it away, after which the home may be protected. This sounds daunting, but it often is not once the options are explained.
There are primarily two options: to sign a Life Estate Deed or an Irrevocable Trust. The first option is relatively cheap and straightforward while the second is more expensive and complex. Which one is right for you depends on several factors we can discuss, including the likelihood of sale during your lifetime and whether you want to protect cash assets as well.
In every case, careful consideration needs to be given first to ensuring you can obtain the right care at the right place.
We’re honored to help with these or any other legal issues.
Please visit our website for more information about our law firm and look out for our video next month when we plan to discuss “trademarks” and whether you may need one.