Follow
Share

What happens to money? I drive a big truck and am looking to buy an economic car to drive back and forth to work. I have my dad's vehicle and pay the insurance on it and drive it back and forth to work but it is also a gas guzzler. He wants to sell me his truck for a couple hundred dollars so I can get it in my name and then take the truck and trade it in on a economy car. Is this possible and can he keep the money in his account or does it have to go to the nursing home since it's an asset?

This question has been closed for answers. Ask a New Question.
dog
Helpful Answer (0)
Report

My parents were allowed to "gift" a vehicle to a relative with no problem in PA, they gave their trunk to my cousin who needed it and helped them out alot. Check your local rules?
Helpful Answer (1)
Report

Another option, if the vehicle is paid for and especially if it is old, is to park it in a safe and protected place and let it sit. You only have to carry liability if there is no lien. I'm actually considering cancelling the liability and turning in the tags. As long as she still holds the title, it's hers and she's allowed one car. Only problem is getting it registered and ensured down the road if you do need to sell it later. You can't allow test drive with no tags or insurance. It's such a bag of worms. lol
Helpful Answer (0)
Report

Great advice from a number of different respondents. At some point, it seems pretty likely that he's going to have to unload his vehicle. But, if it goes to a family member, then you'll need to ensure that however much he receives for it is within whatever the formula for Medicaid sales to family members which is based on some percentage of market value. Getting an appraisal would certainly establish market value. This is a good question for a competent elder law attorney.

On the other hand, there is the question of what to do with the money he receives seeing as he'll have to spend down quickly. In our case, we'd dump it immediately on the pre-Medicaid pending bill at the NH. Your dad may have outstanding bills as well. This is a discussion you'll probably want to have with the Medicaid case worker.
Helpful Answer (0)
Report

If he's on Medicaid he can have a limited amount in his bank account. Call your local Area Agency on Aging, they should have someone there who has information that will help you or at least make a referral to someone who can answer those questions. A vehicle is considered an asset and could pose some issues, an elder law attorney could help with this.
Helpful Answer (0)
Report

Bad idea for multiple reasons:
1. The vehicle is in his name, so it is in the states database for registration and locally for taxation. Any sale or transfer will come up and to the penny. It is a simple couple of keystrokes for a medicaid caseworker to find this out. Any change in their assets has to be reported to Medicaid.

2. If sold for below Blue book value, there would be gifting issues / transfer penalty which could make them ineligible for Medicaid's payment to NH. Can you private pay for the NH? And for the likely months of ineligibility while the state does the transfer penalty inquiry? If done for below BBV, you better have something valid to establish why (like on letterhead statement from mechanic or car lot as to why vehicle is worth less)

3 if sold, then that $ is his asset. They are basically allowed 2k in assets, so depending on the amount, it could go into the asset base to be used for his needs over time. But if this takes him over the 2K, then it has to be spent down on his care or his needs ASAP (like within that month) - hearing aid, eyeglasses, walker - just whatever to be able to do a quick single item spend down so he starts the next month within the required medicaid asset limit. If its a low value car, buying stuff can work. But if it's worth quite a bit, then they would need to be suspended from Medicaid while you figure out how to do the spend down (like get the max prepaid NCV funeral policy, or dental work, or a tricked out wheelchair). If it's a car with significant value, you need to have a plan in place to get all this done within a month if you can to lessen Medicaid complications.

4. Does your state do annual medicaid renewal? My moms state TX does and you have to resubmit documentation on assets (& a bunch of other things as well, nothing but fun) and report any change in assets. If you don't disclose info, state can suspend Medicaid at best or place them ineligible at worst. Whenever there is a change on Medicaid status, they send you a letter BUT also send one to the NH. believe me the NH will require you to private pay with a signed contract in order for him to stay.

Stuff like this tends to snowball into other issues. By selling the vehicle and using it for your gain, you have broken your fiduciary duty as POA. Medicaid caseworker may have to contact SSA (so now you undergo the whole representative payee scenario); state & SSA could ask APS to investigate your suitability as POA.

I also wonder if insurance would be an issue. I totally could see the insurance company declining to pay a claim as the owner may not have the cognitive ability to allow use of vehicle.

Anything other than selling at BBV & using $ for him is problematic.
Helpful Answer (2)
Report

Your dad has wonderful intentions, to give you a great deal, however, therein lies the trouble: he is on M.A. and all his assets become entangled with their rules & regs. If this were me, I would say Thank You Dad, BUT I can't take it because of the way M.A. works....and explain to him how the rules work. There is no way around it, any proceeds from sale of truck belong to state so they can pay his bills. Even if he had "given" you this great deal 4.5 years ago, it would still be a problem, since M.A. goes back 5 years.
Helpful Answer (1)
Report

Does your dad still have his license? My folks sold me thier car when they moved in. No license, and I was not sure how to transfer a car to another state and insure it when there was not able driver? ( Yes agent, I;d like insurance for a sweet ride... no, no one can drive it or has a license...) But my folks live with us.. hoping no problems down the road. I'd think if he can't drive it there should be a way!
Helpful Answer (0)
Report

I agree JessieBelle. I know that Medicaid has rules regarding assets, but I'm no expert. I have a similar situation with my cousin and her car. She's on Medical Medicaid, not in a nursing home. Still, I'm careful of what I do as DPOA. Keeping her car is problematic, but I'm afraid to sell it. Any transfers for 5 years will be examined if she has to go to a nursing home. Plus, while the car is exempt, once it's turned into cash, that cash could disqualify her for Medicaid. It's tricky, IMO.

I do recall that I read around here once that you could have an appraiser prepare a written appraisal of the car and if it's under $2000.00, you would be okay to sell it for the appraised amount, but I would do a lot of confirming before did any transfer. They will check on any title or DMV transfer and find out what happened. It's too risky to take any chances of getting someone disqualified for Medicaid, IMO.

Hopefully, some others will post who have dealt with this issue more closely.
Helpful Answer (1)
Report

Then there could be a problem. Things like cars and homes are considered exempt assets when applying for Medicaid. This means they do not count against the person when the assets are being counted, but if the are sold, then they have to be sold for market value (or close to). The money will be applied toward NH care until it is gone. If the truck is worth, say $2000, and he sells it to you for $200, then it may be seen as a gift to you and result in a penalty.

I have very little knowledge of Medicaid, so there may be a legitimate way this can be done. I hope someone with more knowledge than I have will write. Another thing you can do is to propose it to your Medicaid case worker and see what he/she says.
Helpful Answer (2)
Report

Yes, he's on Medicaid
Helpful Answer (0)
Report

Is your father on Medicaid? This is an important question, since the truck was an exempt asset when he qualified for Medicaid. Selling it below market value might cause some problem. If he is not on Medicaid and will not need to apply for it in the future, it would be no problem. Otherwise, it may be seen as a gift. Let us know if he is on Medicaid and some of the members here may have some advice about what is the best way to proceed.
Helpful Answer (0)
Report

This question has been closed for answers. Ask a New Question.