If the sell of that house was in your name and you out right own it within the 5 to 10 years. 5 to 7 years no so sure about the years. But if the house was out of her name 10 years prior to going to the nursing home then I don't they can touch that. I think that if I am not mistaking the house is rightly yours to do whatever you want with it as long as it's been 10 years. I then read that it was rightly sold to you but it would be willed to you at the time of her death. In that case it would be Probate to the Nursing Home in the event of her death. I think that is what I once learn but you should check with a attorney/lawyer. Just call one up and ask them the question: If I own my mother's house 10 years prior to her going into the Nursing Home is that money legally mine. think if I'm not mistaking it is rightly yours.
If you sell her property while she is still alive....then the money MUST be spent on her health care. It isn’t yours until the will is probated by a court....after she dies.
Yes you are right Katiekate, I didn't understand at first that she's gets the house at her death. I think that the court will award the house to the Nursing Home anyway after her death. Because leagally it's still in her name is that correct. But to be on the safe side I would call a lawyer and ask this question to them.
There are so many factors to consider with this kind of question that your best source of information is an Elder Care Atty. If the attorney who set up the will and POA is still active, pose your questions and concerns with him/her. IF not, you can use your zip code at naela.org to get a list of EC attys. Many will allow a limited first consult for free.
Wills do not take effect until the death of the principal. If the house were sold before the death, then this part of the will would just become null and void. The question posed is CAN the house/possessions be sold.
1) What is mom's status besides being in a NH? 2) What does the POA documentation state? 3) What are mom's current wishes? 4) What is mom's current financial status?
IF mom is not competent and IF the documentation doesn't allow for selling anything, you really can't sell. Our paperwork did give us capability for buying/selling/managing, BUT despite mom having dementia the EC atty said she *MUST* sign the deed. I was able to sign all other documents related to the sale as DPOA, but not the deed. Being a Life Estate might have been part of the problem, but I don't think so. Thankfully the facility has a Notary and when I asked if she had to confirm mom was competent to sign, she said no, I just need to witness that she was the one to sign!!!
IF she is not competent, but the documentation allows for selling, maybe. I would still consult with EC atty. There could be complications selling the house - possessions maybe not, but more than likely these won't fetch much, and it might be better to donate what isn't wanted by family.
If mom is competent, she CAN authorize the sale and CAN sign documents. Clearly if she's in a NH she can't attend any closing or other "meetings", such as with RE, but there are OTHER POAs that can be used. When I sold my previous house, the closing was about a 2 hour drive, each way. Do I want to do that to sign a couple of papers? NO! I signed a temporary POA for the atty to sign for me. My brother had to do this as well, since he lived too far away to go to the closing.
If mom is competent and wants to sell, consult with EC atty and get the ball rolling. If mom's needs more money for her care and her income qualifies, apply for Medicaid. If you need to apply, hopefully you have 5 years of documentation. If you have to go this route, understand that Medicaid will expect to recoup whatever is spent on mom from her estate. So, even though the house is "willed" to you, they can take a share (there are some exceptions, but that would also need EC atty consult.)
How long has the home been vacant (or are you living in it?) If vacant, understand you may need special homeowner's insurance as most/all do NOT cover unoccupied homes/condos. How is the care/upkeep on the place covered? Best to pose all these questions and others with EC atty!
One other consideration - IF conditions are right and you can sell it, setting aside the proceeds for mom's care, read the rest of the will. IF monetary assets are to be equally shared with others on mom's passing, you won't get the full benefit of inheriting the house. While this may be fine for you, it is something you need to understand. Once liquidated, the house and will stipulations for it are null and void. It doesn't mean you get what's left over from the house sale, UNLESS you are the only beneficiary.
I was made DPOA by two friends of mine to be in charge of all their finances and health decisions. The wife had frontal temporal dementia, the husband short term memory problems that kept him from seeing the changes in his wife. I found a one-bedroom memory care apartment for them and after 2 years, got them to move in. Then, I had to deal with their 2 bedroom, full-basement condo. It took me 2 1-2 years to go through all their belongings, separating out their old family photos to pass on to relatives, finding a good home for their furniture, having some needed repairs done, then selling it. All the money went directly to their bank account and was used for the husband's care, as his wife passed away after 5 months in memory care back in 2015. No one questioned what I was doing, but I made sure I had all their bank records, receipts, bills, etc on file to show where their money was spent. Any money coming in goes-went directly to their bank account. Any money going out was by check for a bill with a copy kept to show where the money went. Sometime in the next year, I will be dealing with getting medicare and veteran's benefits started when the husband becomes poor enough. I assume I will have no problems with this because of how this was done. I have more than 5 years of bank records on file to show all their finances. The finance lady at the memory care facility will help me understand how to do these next steps since it is all new to me.
You should have no trouble selling the house in terms of your authority. I never told my friend Jim anything about what I was doing--I just did it. He has never asked about their condo or anything he had. He is happy and well-cared for in this facility and I am grateful I found a place that does a good job. There were no children or close relatives to interfere with all that I did, so that made the job much simpler. I am also executor of his estate so know what their intent was if there is anything left over on his death. There isn't likely to be anything with the costs of this care. He is 93 and in good physical health and shooting for 100 he says.
You've done a wonderful thing for your friends! Good record keeping as well - if it has been more than 5 years, there should be nothing to look back on at this point. It sounds like maybe you aren't quite at the 5 year mark yet though, but if not you are very close! At least you have all the documentation if you need it.
"I will be dealing with getting medicare and veteran's benefits started when the husband becomes poor enough." I will hazard a guess that you meant Medicaid, not Medicare. If this is true, understand that sometimes you can't have both. BUT, on quick lookup I found the following:
"Can someone have both Medicaid and VA benefits? Yes! In fact, if a person is eligible for VA benefits, he/she must apply for them before applying for Medicaid."
So, it would probably be wise to apply for VA benefits first. If he qualifies, he might also qualify for a VA facility - depends on what you feel is best and if he qualifies. Once that is approved, then go for the Medicaid.
I wish I could answer more questions about VA benefits, but the "free" service I consulted with sent me the wrong forms (expired) and after all I went through to get the paperwork submitted, it was denied. I could resubmit, but it would have required redoing almost the whole thing as all the figures changed! I had enough on my plate managing everything for mom and getting the condo clear/clean/fixed for sale, so I let it go. If brothers had been more helpful, they could have offered to do it, but they didn't.
Your mother still owns the house, has title to it. You are acting as her attorney in a way, with your POA, and even though you are heir to the property, you could get into trouble if you sell before you actually inherit. There are probably other people who could claim a share in the estate (there always are!). Supposing they postulate that she could have changed her mind about her will, and you selling the estate, even if all the proceeds were paid into her account, they could produce a claim against you. They could also claim that you did not get a sufficiently high price for it. If she needs the money to pay for her care there are other ways, such as reverse mortgages, that would be safer.
As POA, can you take possession of the funds after sale? They are still her funds and must go toward her care.
How much are capital gains tax on sale before she dies?
After death: you inherit it and can do what you want. Inheritance taxes may apply on yield.
Ask a CPA and elder attorney.
National Academy of Elder Law Attorneys https://www.naela.org/findlawyer <naela@naela.org> NAELA Council of Advanced Practitioners 1577 Spring Hill Rd., Suite 310 Vienna, VA 22182 703-942-5711 <naela@naela.org>
I believe there's no capital gain tax on the sale of a home unless the gain is very high ($250,000 if filing singly or $500,00 if filing jointly). You used to have to buy another house of the same or higher value within a couple of years to avoid capital gains tax, but that hasn't been true for years.
You are correct, if the owner has lived in the house. The last time I checked it was 2 of the last 5 years. This should be confirmed with a realtor or tax professional.
Is your mother all right with the idea? If so, no problem - you use your authorisation to sell on her behalf. Your POA documentation may even specify what you can do with her property.
If she hasn't said, talk to her about it. Explain that the money will be kept safe for her and may be needed to pay for good quality care.
If you fear she would be depressed by the sale of her home and don't want to talk to her about it, is there any reason this decision can't wait awhile?
If she is actively opposed to selling and has said so and is mentally healthy, then no you cannot use your POA to sell it in opposition to her wishes. Does she need the money now or soon to pay for care?
CM, it’s not quite that easy. Her POA may not actually authorize her to sell the house. It doesn’t matter if mom says yes, the OP has to have a POA with certain authorizations on it.
If you sell the house while she is living, it is her property - money will pay for her care. If she passes, you might be designated in the will to get the house/furnishings, but any monies paid out by Medicaid for her nursing home bed can be considered during the probate process. Paperwork is signed when you enter the nursing home to all recovery of Medicaid money. They call it a MERP form. The best thing you can do is talk to the Medicaid worker - they can tell you how the sale of the house and using that money to pay for her care will work. I'm sure each state has different rules, so contact the state agency in your area. If you're not sure where to call, go see the social worker at the facility. They know who the worker is and where the office is.
Talk with Elder Law attorney, Medicaid serves Medicaid and doesn't show you ways to protect anything.. there are a few things that can be done and an experienced attorney can show you the way...it's worth the cost in the long run. Pre-planning of course is always the best bet.
Different states have different rules. My mother had trouble in NYC even after putting her Aunt into a Nursing Home. And that was just to empty her apartment.
Elder Attorney or even Legal Aid in your state should be able to answer that question.
Another option would be to rent the house. Find a reputable property management firm to collect the rent and receive the emergency calls that seem to occur at zero dark thirty, you don’t need that extra work on you. Rent collected can be split between your mothers account and a home repair account. Just a thought.
Don't make a move without consulting a certified elder law attorney. Whatever it costs it is likely to be a worthwhile investment. It's all very complicated these days.
I would add to the other qualified advice you have received that you might want to find out what capital gains tax might there be on the sale. This shouldn't prohibit you from selling. If she has records of improvements she might have made over the years that could be beneficial. Those along with the price she paid or was paid for the house would possibly affect taxes on gains assuming there are ones.
Yes, the improvements/repairs, if you have the documentation, can be used to reduce the "gain". Also, because mom and dad owned it together, there was a "step up" at the time of dad's passing (reduces the gain - you need some good legal and tax advice for this.) We would have had the step up too, had we waited for mom's passing (Life Estate), but given the cost to fix and keep up with taxes and condo fees, and the downsides to renting, it wasn't worth hanging on to it - not for me at least!
Also understand there is also an exclusion potential of up to $250,000. The "gain" I got when I sold my previous house was under this amount, so I paid NO capital gains tax on it.
Each state has variations with Medicaid so you better seek an eldercare attorney. Do not take any kind of legal advice on here. Medicaid is very tricky and even deceptive--you are going to find out the government is VERY dirty and underhanded when it comes to money and Medicaid.
I wouldn't really agree that the government is dirty, but yes there are very complicated rules in place that most people cannot maneuver on their own. Medicaid pays for facility care when the patient has run out of cash or does not have enough income to self pay. The house (and other things) is left out of the process when there is any chance they might return home (and for a spouse who may still live at home). A form is signed when you are in a Medicaid bed that says the state can recover money paid for your care out of whatever is left in your estate when you die. So the $200,000 home that you had could be sold to pay the state back for the free bed you had. I'm sure the kids are all standing in line to get their share of the $200K home, but the state should be paid back first. If you think about it, mom got basically got a loan from the state for an unknown ending amount when she went to the facility and state will ask the probate court to pay the money back when she dies. Most people are always saving something for old age. In this situation, the $200K house is the asset to cover the loan. Most older folks would tell you they don't want to leave this earth owing anyone.
You have to read your power of attorney statement but most of them allow the POA to sell property. If for some reason, the POA does not allow that and your mom is still capable of making her own decisions, she can sign a POA that allows you to sell her house for her.
Some states require the POA document to specifically state that the POA can conduct real estate transactions. Most POAs actually don’t state that real estate can be handled.
MJC, good for you to understand that mom's assets are to be used for her care. The POA, most likely, does provide you the responsibility to sell her assets and property. Keep n mind, anything sold must be at market value.
Check First with a Lawyer. It seems they may use all of this to pay her way, Including the Home, Dear, If Dear Ol Mom never did the 5 Year Deal of Protecting IT.xx
You can sell in her name, but of course all proceeds will go into your mother's account for your Mother's care. This will afford her a perhaps enhanced quality of life, better placement, and etc. But remember, you are acting FOR your mother and IN your Mother's interests and all proceeds belong TO YOUR MOTHER. Keep exceptionally meticulous records. You are, in essence, acting as your mother in this action. Of course once this action is done, the will, and who it deeds the house and furnishings to is irrelevant. Your mother's estate will be divided as otherwise stipulated in her will.
Is Mom on Medicaid or private pay? If on Medicaid or in the future, a sell of the house needs to be sold at Market value. Those monies going towards her care. If on Medicaid, it will stop till the proceeds are spent down then Medicaid reinstated.
Read your POA. Mine said I could buy and sell. Is it immediate or does Mom have to be found incompetent. Because if she is competent you have to have her OK to sell.
What the will says is irrelevant until she has died. If she is mentally competent she can authorize you to sell the house. The POA must have certain language/assign certain powers in order for you to be able to sell the house. So it’s gonna depend what type of POA you have and what it says.
I don’t think the will comes into play at all while she is still alive but as long as she agrees, even reluctantly, that it’s time for the house to be sold you should be able to handle that for her as POA. If she isn’t capable of making that decision and your POA is also a DPOA you should be able to make that decision for her as well as long as she isn’t fighting it and clearly saying “absolutely not” or something. In the case of her refusing and fighting it you probably need to get guardianship to sell the house unless of course her DPOA gives you the ability to make financial decisions even when she doesn’t agree. There can be a fine line between the inability to agree and not agreeing so only you really know how much of a challenge she might mount.
Wills do not take effect until the death of the principal. If the house were sold before the death, then this part of the will would just become null and void. The question posed is CAN the house/possessions be sold.
1) What is mom's status besides being in a NH?
2) What does the POA documentation state?
3) What are mom's current wishes?
4) What is mom's current financial status?
IF mom is not competent and IF the documentation doesn't allow for selling anything, you really can't sell. Our paperwork did give us capability for buying/selling/managing, BUT despite mom having dementia the EC atty said she *MUST* sign the deed. I was able to sign all other documents related to the sale as DPOA, but not the deed. Being a Life Estate might have been part of the problem, but I don't think so. Thankfully the facility has a Notary and when I asked if she had to confirm mom was competent to sign, she said no, I just need to witness that she was the one to sign!!!
IF she is not competent, but the documentation allows for selling, maybe. I would still consult with EC atty. There could be complications selling the house - possessions maybe not, but more than likely these won't fetch much, and it might be better to donate what isn't wanted by family.
If mom is competent, she CAN authorize the sale and CAN sign documents. Clearly if she's in a NH she can't attend any closing or other "meetings", such as with RE, but there are OTHER POAs that can be used. When I sold my previous house, the closing was about a 2 hour drive, each way. Do I want to do that to sign a couple of papers? NO! I signed a temporary POA for the atty to sign for me. My brother had to do this as well, since he lived too far away to go to the closing.
If mom is competent and wants to sell, consult with EC atty and get the ball rolling. If mom's needs more money for her care and her income qualifies, apply for Medicaid. If you need to apply, hopefully you have 5 years of documentation. If you have to go this route, understand that Medicaid will expect to recoup whatever is spent on mom from her estate. So, even though the house is "willed" to you, they can take a share (there are some exceptions, but that would also need EC atty consult.)
How long has the home been vacant (or are you living in it?) If vacant, understand you may need special homeowner's insurance as most/all do NOT cover unoccupied homes/condos. How is the care/upkeep on the place covered? Best to pose all these questions and others with EC atty!
One other consideration - IF conditions are right and you can sell it, setting aside the proceeds for mom's care, read the rest of the will. IF monetary assets are to be equally shared with others on mom's passing, you won't get the full benefit of inheriting the house. While this may be fine for you, it is something you need to understand. Once liquidated, the house and will stipulations for it are null and void. It doesn't mean you get what's left over from the house sale, UNLESS you are the only beneficiary.
You should have no trouble selling the house in terms of your authority. I never told my friend Jim anything about what I was doing--I just did it. He has never asked about their condo or anything he had. He is happy and well-cared for in this facility and I am grateful I found a place that does a good job. There were no children or close relatives to interfere with all that I did, so that made the job much simpler. I am also executor of his estate so know what their intent was if there is anything left over on his death. There isn't likely to be anything with the costs of this care. He is 93 and in good physical health and shooting for 100 he says.
"I will be dealing with getting medicare and veteran's benefits started when the husband becomes poor enough."
I will hazard a guess that you meant Medicaid, not Medicare. If this is true, understand that sometimes you can't have both. BUT, on quick lookup I found the following:
"Can someone have both Medicaid and VA benefits? Yes! In fact, if a person is eligible for VA benefits, he/she must apply for them before applying for Medicaid."
So, it would probably be wise to apply for VA benefits first. If he qualifies, he might also qualify for a VA facility - depends on what you feel is best and if he qualifies. Once that is approved, then go for the Medicaid.
I wish I could answer more questions about VA benefits, but the "free" service I consulted with sent me the wrong forms (expired) and after all I went through to get the paperwork submitted, it was denied. I could resubmit, but it would have required redoing almost the whole thing as all the figures changed! I had enough on my plate managing everything for mom and getting the condo clear/clean/fixed for sale, so I let it go. If brothers had been more helpful, they could have offered to do it, but they didn't.
How much are capital gains tax on sale before she dies?
After death: you inherit it and can do what you want. Inheritance taxes may apply on yield.
Ask a CPA and elder attorney.
National Academy of Elder Law Attorneys
https://www.naela.org/findlawyer
<naela@naela.org>
NAELA Council of Advanced Practitioners
1577 Spring Hill Rd., Suite 310
Vienna, VA 22182
703-942-5711
<naela@naela.org>
If she hasn't said, talk to her about it. Explain that the money will be kept safe for her and may be needed to pay for good quality care.
If you fear she would be depressed by the sale of her home and don't want to talk to her about it, is there any reason this decision can't wait awhile?
If she is actively opposed to selling and has said so and is mentally healthy, then no you cannot use your POA to sell it in opposition to her wishes. Does she need the money now or soon to pay for care?
If it is not clearly stated reach out to your local legal aid agency who may be able to help you clarify🙏🏾🙏🏾🙏🏾🙏🏾
Elder Attorney or even Legal Aid in your state should be able to answer that question.
Also understand there is also an exclusion potential of up to $250,000. The "gain" I got when I sold my previous house was under this amount, so I paid NO capital gains tax on it.
I'm sure the kids are all standing in line to get their share of the $200K home, but the state should be paid back first. If you think about it, mom got basically got a loan from the state for an unknown ending amount when she went to the facility and state will ask the probate court to pay the money back when she dies. Most people are always saving something for old age. In this situation, the $200K house is the asset to cover the loan. Most older folks would tell you they don't want to leave this earth owing anyone.
Nevada needs a specific POA. That is the only place that I have sold property as a POA.
Read your POA. Mine said I could buy and sell. Is it immediate or does Mom have to be found incompetent. Because if she is competent you have to have her OK to sell.