I am on my children's savings and checking accounts. Will this be a problem with the Medicaid five-year look back period?

Asked by

I am 54 years old. I am on my children's savings and checking account. They are 20 and 25 years old. The funds in their accounts are not a gift. It is their own money. Will there be a problem with the five year look back period. Should I take my name off their accounts? Just planning ahead for the future and do not want my kids to lose their money since I am on the accounts.

Answers 1 to 10 of 10
Expert Answer
415 helpful answers
The rule for joint bank accounts when one of the owners applies for Medicaid: 100% of the funds are deemed owned by the Medicaid applicant except to the extent the other owner(s) can prove contribution of funds to the account. So, to avoid having to go through that, it's safer just to take your name off the accounts. Since none of the money in the accounts came from you, doing so is not a gift and there is no penalty for doing so even if you need to apply for Medicaid within the next 5 years.
Expert Answer
387 helpful answers
Take your name off for the reason Mr.Heiser stated but as importantly, and more relevant to the present and intermediate term, is that their money is may be subject to the claims of your potential creditors in the event of a judgement found against you.
Good time to consult with an elder law attorney. Why are you on their accounts in the first place? Is it for you to receive their money if  they die? Change to a Payable on Death ownership account.
Take your name off their accounts.
Make it transfer on death instead. Not joint and survivorship.
I hope that Medicaid won't look at this account as if some funny business is going on. I know in New York, a person could have up to $14,000 in their account and still apply for Medicaid. If they see money moving around too much, it will look suspect. If you have to show them 5 years bank statements and they see chunks of money being moved, they want to know why and who. I agree that you should contact an eldercare attorney. Make sure he is familiar with the Medicaid system. I did -- and he was able to talk with Medicaid which allowed me to make better decisions for my parents. I'm not sure if this answers your question, but it will give you something to think about going forward.
Yes, it may cause a problem with their income tax, or with probate if you die before them. Ask a banker or a lawyer for advice. I took my bank's advice and made all my accounts "payable on death" (POD) accounts.
They were under the age of 18 when accounts where open.
If the money in the accounts are theirs, then take your names off the account. No problem. You still have one year before you would even face for over-55 Medicaid requirements. Opening the accounts when they were young and removing names later (or young people moving money into their own accounts) is often done. I doubt anyone would think it odd.

Of course, the biggest question is if you would have to apply for Medicaid anytime in the near future. You are 10-15 years younger than many of us here who are caring for elderly (80+) or disable people. If you aren't going to apply for Medicaid anytime soon, then taking your name off the accounts would not even be looked at.
You are 54 years old. Life expectancy for a woman in the USA - let me just check - is 78.94 years.

I'm quite surprised, actually. Thought it would be higher. But anyway.

It is of course a good idea to get one's affairs in order because we can none of us ever be certain. But do you have any particular reason to be anxious about this? Why the sense of urgency, so that you feel the need to post specifically on AgingCare?

I'd suggest that one thing which might be worth doing is counselling your newly adult children to sort out their accounts, though, and check that everything is organised as they would like it to be.

Share your answer

Please enter your Answer

Ask a Question

Reach thousands of elder care experts and family caregivers
Get answers in 10 minutes or less
Receive personalized caregiving advice and support