Can my Mom spend down some of my Dad's half to fix items for her home?

Boschees and pamstegma, I am under the impression you can have parents pay for improvements to your house once they move in if it is a benefit to their living situation in your house. I have spoken to an elder attorney and he told me it is possible by keeping excellent records, making sure it is needed for them (for example, my father who I recently moved into my in-law suite has early dementia and is a wander risk so a fence with a locked gate around the backyard, where his entrance is, is absolutely essential) and taking it as the equivalent of fair-market rent. Alternatively, you could charge them rent and pay income taxes on it. So for example, if the fence cost 5K and the fair-market value of the rental unit is 1K you could put up the fence and make it the equivalent of 5 months rent. To be totally safe, you could split it in have and make it equivalent of 10 months rent since ultimately it is an improvement to your property. But in cases where I would never put handrails up if he were not living in my house, I am recording it as his expense (as in truth I will be taking them out down the line).

I went through this application process for my Dad and are now starting for my Mom. You really need the attorney....trust or eldercare attorney. Here in AZ for my Dad's application we had to do the spend down, but was told it could only be for necessary home repairs or improvements OR medical or paying in advance for funerals. Mom got her new hearing aids. We replaced flooring in her house, had it painted and some minor repairs done on the house that were needed. Monies spent on anything else, or anyone else to where it could be considered a gift....caused a certain number of months of waiting longer for approval...sort of a "punishment period".

GrannyM, some of the damage you mention would be covered by homeowner's insurance, such as water damage, and the auto insurance should cover damage to the garage.
Violet521, replacing the windows should have generated a tax credit if they had a higher insulating value. The $11,000 spent on the apartment windows would be written off on Sched E (rental income). I hope you win the appeal, but I am doubtful.
Grace301, if the patient is on Medicaid, there really is no money for repairs. READ the application, it tells you the patient's entire SS check goes to the nursing home, with only a small monthly PNA (personal needs allowance) of $30-65.
Boschees, no you cannot let them pay for improvements to anyone else's home, that would be a gift unless part ownership is conveyed in return.
Brit, make a list of all your expenses, because you do get a community spouse allowance. The amount varies by state, but it runs $2000-$3000 per month based on what you spend now.

I like experts answer above. She is his wife and should be entitled to do as she sees fit. Home improvements can serve multi purposes: one for resale value if determined or/and if she stays in home, the improvements such as a new furnace will most likely bring savings in monthly bills making up for some of the cost. Some improvements can serve to equip your mom later for staying in their home where it may aid in your dads return home as well. One can always look at in home caregivers outside of the family if too much. There is private help that may be more economically to their advantage or can use an agency. Improvements can bring happiness and peace of mind and something the elderly should be able to enjoy.

Hello hurst406, My Dad did the same exact thing with his IRA worth about 23K. So he ended up paying a lot of tax that year. We talked to the lawyer about it, and his opinion was just what you are thinking, that fighting it was not really possible, and not likely to save us much anyway. Years later, we just shake our heads at the thought, that this was just one of many really stupid decisions he made. Sometimes you can't protect them from themselves.

Also the other answers are right, you don't necessarily need guardianship, but you do need both Medical Power of Attorney, and Durable (aka financial) Power of Attorney.

We worked with an attorney who specialized in elder law when we went through this the first time, with Mom. Due to Mom's dementia and pure stubbornness on both their parts, my parents' home was a wreck. Thank goodness this spending was allowed, as everything they owned was decades past the point of needing replacement.

According to the lawyer, they had to divide their assets, Mom went in the nursing home. The amount Dad could keep was just a bit less than half. Using Mom's slightly larger half, we were allowed to replace the roof on their house, replace the ancient patio-doors, replace the old kitchen floor, buy new living room sofa, a lift chair, new TV, new top-of-the-line hearing aids for Dad water proof the leaky basement, paint the house, new glasses for them both, and a fancy wheelchair for Mom. There was more that should have been done, and had we worked fast enough, could have. But Dad had the beginnings of Dementia, and fought it every step of the way, with major argument over every purchase. There was just no getting him to understand that Mom's half of the Money was going to be all gone no matter what. Either the money would be gone, and he'd own a house in good condition, Or the money would be gone and he'd still be living in a dump. I'm not sure he ever understood. ...Also, don't forget that the staying-at-home spouse is allowed to keep their house, and one car, separate from the division of assets. (If they own a second car, or a boat, or a second home, the value of all that is included in the amount to be divided. I'm just pointing this out, in case your Mom's still drives a car, it makes sense that it should be a good car. If the one she's driving is old, you might consider trading it in on a nice reliable newer car. ...Best advice it to get a lawyer that specializes in elder law, so you know how it all works in your state. It's expensive, but worth the money. Don't forget, that money will come out of the spend down also.

Thank you all for your posts. My family has not yet filled out the Medicaid application. We are in the process of paying their income taxes (my dad emptied out his IRA and put it into a savings account without telling us). They now owe over $20,000 to the IRS. I've thought about fighting to get that reversed because of his dementia but we really need to get the Medicaid forms filled out. Medicaid would probably take half of that money anyway and it would take too much time.
It's frustrating because we have to pay a lawyer for help with paperwork along with paying the IRS.

Gabriel one thing that worries me is that even tho I will be allowed to keep my home etc, how will I afford to pay taxes and every day expenses etc if my husband has to go into NH on Medicaid and I only get a small amount of income from his pension/SS to live on?

Our parents moved in with us because they can no longer stay in the home they own. They need a stair lift and a walk in bathtub to make the downstairs into a lower level "mother in law apt" for them. Can they spend down some of their assets on these items if it is not installed in their own home, but in their son's home?

My mother has Dementia she is in a care home. She receive Soc Sec, Medicaid and Aid and attendance. She owns her own home which needs a lot of repairs.
Can she use any of her income for repairs.

Yes, as other correctly stated, it is not a "gift" to spend down the Medicaid applicant's funds on themselves, e.g., repairs or upgrades to the home. However, don't forget that the spouse at home is entitled to $119,220 of cash and other countable assets (in other words, in addition to the value of the home, car, personal property, etc.).

Hurst - I would suggest you take a few steps back to look at the bigger picture for your parents and the role Medicaid poses for their life BEFORE mom goes and spends down their assets.

Now dad is already in a NH, right?so he is currently private pay, right?

Has dad already applied for Medicaid? If so, this is problematic as for couples when 1 is applying for NH Medicaid & the other remains as the "Community Spouse" the rules set by Medicaid for evaluating their application are in place. It's my understanding that for couples, the program does a snapshot day which is set on the date of the application in which their assets & income are fixed. So if they have 200k savings; 3,800 in monthly income; dad has 50k cash value insurance policy on the date of the application, those are the hard # that medicaid is going to use to set the spend-down $ on.

So is this the situation - already applied with fixed $ known - that your mom is at? If so how much $ does your state allow for CS assets (most are 114K) and how much over that does she have to spend down? Does moms CSRA or MMNA cover her costs fir her day to day & to stay living at the house?

If dad has NOT applied for medicaid, this is better as then there likely are things that can be done to place mom in a more advantageous financial situation. For CS how to best approach planning for assets & income really need to be planned for BEFORE the application. If mom is a healthy CS, she could outlive dad by a decade or more. It is central to realize that ONLY the NH spouse that needs to be impoverished, not the CS. She really needs to maximize whatever assets there are to secure her future and not place herself close to her own impoverishment. I would suggest that you & mom ASAP see a elder law attorney, see if you can get one NAELA too as CS planning is a bit more complex.

If mom could realistically stay in the house a decade plus, then spending on the house makes sense (my mom lived in the house 25 years after dad died); but if mom herself is likely to need Medicaid NH later this year or next, then spending on house is a waste as the house will likely be sold with the $ from the sale placing both mom & dad back to private pay till they impoverish themselves. For example, Instead of 20k on new roof, it may be better spending it on dental work for them as dental really isn't covered by Medicaid.

So medicaid application in for dad or not yet?

The best thing I did after Mom's head injury 3 years ago was get POA for Financial and Medical. If you only have medical you need financial. I can't remember what its called, but our Lawyer talked about something where if the house is owned by both you can have something where if one spouse is not able to speak for themselves, their half of the house will go to the other spouse. My husband and I did our wills but not POA's. This is something I'm seriously looking at doing soon. Just because you are the spouse, you have no legal claims unless you have a POAs.

My mom spent about $35,000 on home repairs in the 5 years before she was able to accept the hard truth that she could no longer care for my dad at home. We moved him into an NH in Dec. 2013 and she paid privately for 6 months. She owns a two-flat building and lives on the first floor and rents out the second floor. The most expensive of the repairs was replacing all the windows. That cost her $22,000. The house was built in 1913 and only 5 windows in each apartment unit had been replaced and that had been in 1977. The loss of heat and AC and draftiness of the house was always a big problem. She submitted all her financial records when she was completing my dad's Medicaid application. He was approved for Medicaid within 6 months (which we were told was miraculously quick) but the State of Illinois then notified her that she would have to refund the state half of the cost ($11,000) of the windows because technically the new windows weren't an improvement to her house. But she OWNS the whole building!! It's so ridiculous. With the help of a Medicaid/Medicare consultant and an elder attorney she appealed that decision. The hearing with the state was 2 weeks ago and we are waiting their answer. The lessons I can offer here are 1) keep meticulous records of everything you spend, including bank and credit card statements and receipts; 2) Don't assume anything. If you aren't sure a specific expenditure will be allowed, check with an expert first or call the state Medicaid office and ask them. Make sure to get the representative's name, record the conversation, and/or ask for a written response. The person who later reviews your app probably won't be the same person who answers your question.

Dear GrammyM, I hope you are safe? "Explosion" part was scary. Good you weren't standing nearby.

...seminars the Alzheimer's Association sponsors. Sirry, daylight savings lack of sleep and typing on phone. Good luck to you.

You can repair the home the person owns as part of the spend down. I would get a lawyers help with thr medicaid application. They know loopholes that get you on medicaid while saving you the most money. You should start by attendinf one of the free medicaid planning semibar

This question must have 'opened' spouse's and caregiver's eyes! Great question--thought provoking and one that needs to be addressed in nearly everyone's situation. However, I am confused. We have (my husband and I) a legal Will that states if either one of us becomes unable to care for ourselves, the other spouse has the right to do so. It's an attachment to our Will that we both signed. I was under the impression this is a POA. Am I wrong? I hope not. This beautiful Will cost us $900 to have prepared by a very elite law firm. Could call the law firm, however, I'm hesitant to do so thinking a phone call would be billed for another couple hundred of dollars. Also, curious about home improvements. We had a new roof, siding, a new windows installed a few years ago that was paid on installment plans. However, with my husband's advanced Alzheimer's our house is being ruined---deplorable carpets, broken tiles on floors, discolored and bubbled bathroom flooring resulting in water damage from forgetting to turn water faucets off in bathroom sinks during the night, holes in plaster walls from thrown objects during temper tantrums, destroyed blinds, broken door handles, etc. Doing inventory to have the most critical construction work done---mainly new bathroom floors, cracked ceilings and wall damage from water under above bathroom flooring, plus mold would cost thousands of dollars and nearly wipe out our savings. Could this cost be used as 'spend down' expenses? It really is a very interesting subject. Husband burned up tractor mower years ago by putting kerosene instead of gas in the gas tank. Doing so, the mower nearly exploded taking out chunks of our concrete driveway. Would this be a 'spend down' expense replacing the mower and concrete. Nine 9 years ago, before PCP would evaluate and diagnose my husband's lack of memory and/or sound judgment, several bricks and part of frame were taken out on the side of garage when hubby misjudged the garage wall with his car. Is this a 'spend down' expense. Sorry this is so lengthy, however, other situations must be similar to mine caring for Alzheimer patients who simply refuse they are any different than they were 20 years ago. In fact, everyone is wrong...but them. They destroy, but someone else did it.

Where do you live? We went through this in NY. The "community" (the spouse living at home) spouse can spend money to improve their home, and other personal expenses. She cannot give money to family. There lots of rules. Does your father have a health care proxy or a living will? This is VERY important. At least in NY to a certain extent, your mother will be considered in medical decisions. A legal "guardian" is not necessary unless someone has no family or there is a dispute among family members. When my Mom had a stroke, we siblings respected my father's wishes and he made the emergency decisions at the hospital that night. Having a proxy or living will makes it much easier for medical staff (and better legally).

Yes...however, please ensure that these are indeed repairs rather than improvements to the home. For example, a new roof would qualify (even if the existing one is still adequate) but a swimming pool is another matter.

Sondra, no you do not need guardian status. These are put in place to help an elder when they are unable to determine appropriate care, etc. POA is power of attorney which is probably what you have had done. Spend down is to use assets to pay for most anything so that Medicaid will pay for care instead of it coming from your pockets, impoverishing you.

What is a POA and what is a spend down? My husband has Alzheimers. We went to a lawyer and he drew up papers which my husband agreed to and signed giving me power of attorney over his medical decisions. But I have no court papers saying I am his guardian. Is that something I need?

Both answers above are very good. Check with an attorney if you have one. If not try to find one that will not cost you an arm and a leg for advice. We are in the act of looking for one also. Some will say they will help but do not. Be careful is easier said than done. People always say check with your lawyer or accountant. As if you have them on speed dial. We have neither and we are 60 and 65 years old. Do know that you are not "Guardian" without a court order. Which is another money maker for someone. Very good question you posed which I myself would like an answer. Thanks for the question.

We agree with Pam. In our experience, you can pay for home repairs as part of a spend down. The key is that your dad's money has to be spent on your dad. Home repairs ought to meet that requirement. But check with an attorney up front. If your dad is still competent enough to sign a POA, that ought to be your first priority.

Mom is not a "Guardian" unless she has a court order saying she is.
If the house is jointly owned, the repairs are jointly paid, 50/50.
You really should take mom to see a lawyer ASAP.