I wasn't sure how to ask that question briefly, and I know I need to talk to a lawyer, but we have been holding off in case we decide to move. Right now I am with my dad in CA. His house is part of a trust that has 3 beneficiaries named. I am a cotrustee. We were hoping to move my dad back to OR, where I just came from and my husband is employed, but now that we are learning more about insurance, Medi-Cal, etc. we are undecided...
My dad is far enough along with dementia that he can not live alone, so it could easily be established I am here taking care of him to keep him out of a facility. I was reading about how he can transfer the house to me after 2 years and exempt it from being a lookback asset. But I am wondering if he would not be able to do so since the house is part of the trust. If he is incapacitated by then, then what? I am POA, so could I transfer it to my name after 2 years? Just for the record, I would plan to split the money with my brother and sister when I sell it, and I think (hope) they would trust me to do so.
Which brings up another question.... If a house does get transferred to a child after 2 years, is there any obligation to live in it for a set amount of time?
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As for your other question, the child receiving the house under the caregiver exception does not need to continue living in the house. The test is that the child have cared for the parent and resided with the parent in the parent's house for at least the two-year period immediately before the parent enters a nursing home, and that such care allowed the parent to delay needing to enter a nursing home.
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A trustee or co trustee may also be a beneficiary, the stipulations of the trust must be followed,of course. In a co trustee case, it must be established: if trustee's can act unilaterally or must both act
If one moves in for at least 2 years, and the parent then needs a Medicaid Nursing home, and it can be established that but for the efforts of the 'caregiver', the Medicaid recipient would have been required to move into to the NH to have received at least the kind of care & safety, that the caregiver provided; then upon the recipients passing the house should be exempt from recovery.
A Dr. should be able to confirm, and have been consulted on a regular basis.
It would also be wise to set up a 'or' bank account, & to deposit funds (needed for care) from it , into a second account (from the 'or'), that might say "So & So" care services account, and pay the bills out of that second account, & maintain a journal, of services provided and payments dispersed. for Medicaid gifting protection purposes. It may also serve to protect the caregiver from having to pay taxes on the perceived 'income'
But as I understand - only the person who established the trust (your father in this case) can change the trust (if it is a revocable trust).
regardless of who the trustees are - they have to abide by the terms of the trust.
(beneficiary status only comes into play when owner of trust is gone.)
If trust owner needs to sell house to pay ltc or other care - then trustee (or co-trustee if there is one) and father (co-trustee) is incompetent then remaining trustee could sell house and deposit money into account to pay trustees expenses in ltc, etc.
If trying to hold onto as protected asset under "caregiver" status - you will need lawyer. I would think Medicaid would try to get repayment when he passes and depending on how long he remains in ltc - 2 years of caregiving somewhere in the past vs how many years he is in ltc?? Don't know how court would decide how much caregiver would be entitled to - doubt if it would be total value of asset (house) - depends on where you live. If he now has dementia don't think any lawyer would convey property to him much less allow you to sell property (acting as trustee) other than to pay for his ltc expenses.
Beneficiaries would only get what's left of proceeds after he passes.
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