How Home Sale/Lease Back Treated by Medicaid?

by max
(PA)

hypo:

-parents own house.
-son buys the house from parents for fair market value.
-parents lease house back from son at fair market rental value.
-how would medicaid treat this?

any comments?

Comments for How Home Sale/Lease Back Treated by Medicaid?

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Sep 29, 2010
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Cash paid may make it difficult to qualify for medicaid
by: Gabriel Heiser

I'm not sure why the parents would trade their house (an exempt asset) for cash from the son (a countable asset) but in any event, so long as the son pays the parents the fair market value there is no gift to worry about.

Again, if the parents are paying fair market rental value to the son under the lease, there is no gift and it is perfectly acceptable to do this.

I'm not sure what the Medicaid plan is, here?it's a little unusual?but depending on the facts of the case, there could be a good reason to do all this!

I write more about medicaid planning at MedicaidSecrets.com

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