If you’ve looked into Medicaid eligibility at all, you are probably aware there is something called a look-back period, which basically says that gifts and other transfers of assets for less than fair-market value that are made within five years before someone applies for Medicaid will cause a transfer penalty, which can cause a delay in eligibility.
So, one of the questions that that very naturally raises is: Well, what about things like birthday gifts, holiday gifts, wedding and other special occasion gifts, do those count against you?
In this Elder Law Minute, Wes Coulson, O’Fallon Illinois Elder Law attorney, discusses the five-year look back rule and how birthday and holiday gifts are viewed in regards to Medicaid eligibility.
Are Birthday And Holiday Gifts Included In The Medicaid 5-Year Look Back?
Transcript:
Hi, I’m Wes Coulson from Dent-Coulson Elder Law with offices in O’Fallon, Illinois and St. Louis, Missouri and this is your Elder Law Minute. If you’ve looked into Medicaid eligibility at all, you are probably aware there is something called a look-back period, which basically says that gifts and other transfers of assets for less than fair-market value that are made within five years before someone applies for Medicaid will cause what is known as a transfer penalty, which is a delay in eligibility starting from the month of application.
So, one of the questions that that very naturally raises is: Well, what about things like birthday gifts, holiday gifts, wedding and other special occasion gifts, do those count against you?
There’s a little bit of a common sense rule that applies there and that is what they’re going to do is look at those gifts near to the time of application and ask, “Are these consistent with what they have been all along.”
So, if you’ve always given your children $100 each for their birthday and have spent $100 each on your grandchildren for special holidays and you continue to do that, no that’s not going to count against you. But, if what have been $100 gifts become $500 gifts and then $1,000 gifts as you get closer to the point of needing nursing home care, they’re going to say, “Well, no those are not ordinary and common gifts, those are something that are done having in mind the possibility of needing nursing home care and they will count those against you in examining your Medicaid eligibility.”
So, hopefully that helps clear that up. There are a lot of things that are little points, that even if you think you understand the basics, are things that can wind up making a big difference. Moral of the story here is: Give us a call because we can help you through all of these little things that can add up to big things. Thanks.
For more information on Medicaid and the look-back rule, visit these articles:
- Will Transferring Assets Between Spouses Cause A Medicaid Transfer Penalty?
- Withdrawals from Joint Accounts: Are they subject to transfer penalties?
- Look-Back Rule and Delay in Eligibility
“Your Trusted Advisor on the Elder Care Journey”
Dent-Coulson Elder Law is dedicated to providing families in the St. Louis area with their Elder Law needs. Our practice areas include Asset Preservation Planning, Veterans Benefits, Medicaid Eligibility, Alzheimer’s Planning, Special Needs Planning, Estate Planning and more. We understand the financial challenges you may face as you and your loved ones grow older. At Dent-Coulson Elder Law, our clients’ well-being is our number one priority. For immediate help, call (618) 632-7000 or (314) 567-9292, or Contact Us and we will get in touch as soon as possible.
