My 2 brothers and I inherited our parents home in SC. I do not live there but both of my brothers do and they are both on SC Medicaid. I'm wanting to do a quit claim deed and remove my name from the deed. We all agree and there's no dispute. Since my brothers already live in the home and are co-owners, will it effect their Medicaid benefits?
Good luck.
Yes, inheriting a house will effect their Medicaid if they sell. If they live in the house, for now, its an exempt asset but if one of them passes, Medicaid will put a recovery lien on the house in the deceased brothers name. Other brother can live there but when he passes, a lien will be placed in his name and the house will need to be sold to satisfy the liens.
This is really important to know as how it reads is a starting point for how involved of process it will be to properly remove ownership. I’m assuming 1 of your parents predeceased the other and the surviving spouse had a valid will that entered probate court so that the home went through the proper filings to fully have the title transferred as per their will to all 3 heirs equally by probate court orders. So did this happen? and the County Courthouse records show this?
Is in how the Homestead Exemption is done correct for each of y’all’s % ownership…. like taxes are different for the bros than for you as you have no homestead exemption on your 1/3? Multiple heirs with some living in the home, others not / some paying their share others not…well inequitable distribution of ownership costs & taxes tends to be a hot mess. Getting this done all properly will be important for all of you AND this means having an SC attorney review the situation and come up with options for all 3 of you to do.
You as the gifting sibling, well you have IRS filing to do… Form 709… it’s NBD for taxes as you have a lifetime exemption of 14M; but still needs to be filed & done correctly (cost basis) So that’s tax advisor or real estate attorney work.
Regarding your brothers & Medicaid….. Medicaid is a huge # of different programs all under the “Medicaid” umbrella. Do you know which Medicaid program(s) each of them are on? I bet it’s Medicaid as health insurance, right? It’s Medicaid to go with their Medicare for health insurance and is kinda for most States a fairly standard eligibility for those with low/ lower income (under $2,901 a mo) and by & large does not look at assets.
But other Medicaid programs do look at assets…. these would be like LTC Medicaid which pays for custodial care costs in a facility or HCBS which is Medicaid that pays for community based stuff, like InHome Healthcare Services or are enrolled in PACE. For these programs, changes in assets are supposed to be reported. House has a value and their increased ownership % = an increase in assets. By & large their ownership share of the home is an exempt asset for eligibility unless it’s way way up in value (over 800K/900K). If an unreported change in assets surfaces, Medicaid will do an inquiry and if your bros don’t deal with it and properly, it can cause paperwork issues which they or their POA will need to deal with.
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Regarding Quit Claim Deeds, they do not guarantee ownership. What they do is transfer what you think your ownership is to another. If there are leins, clouds on the title, securitized lending, judgments, taxes owed, etc, all that remains. Because of this, for your brothers, trying to sell it or get lending on it will be challenging. It wouldn’t be your problem but theirs and whomever would be their Executor.
Transferring property via a Warranty Deed guarantees ownership and can have title insurance placed.