Medicaid and Inheritances: Planning Ahead Is Essential

Last updated on: July 14, 2022

Medicaid and inheritances can be tricky affairs, and mistakes can cost a lot of money. When a person is drawing Medicaid benefits and inherits money or property, that inheritance jeopardizes the benefits. The inheritance must be handled carefully to minimize expensive penalties. What “careful” means, though, can be misunderstood without the necessary expertise. Before making any decisions, it is important to speak with a Medicaid planning lawyer.

The Right Steps for Handling Inheritance

The first and best idea is to call experienced elder law attorneys like us. (An even better idea is to call us well before any inheritance becomes a “problem.” The sooner you call us, the more money we can likely protect for you.)

An Ohio attorney was recently suspended partly because he mishandled this Medicaid-inheritance issue. The mistaken advice was that to protect the benefits, the person who stood to inherit should “disclaim” or “renounce” the inheritance – in other words, give it away to someone else.

Medicaid Rules and Inheritance Context

That advice would have been OK in the tax context. It was not OK in the Medicaid context. The Medicaid rules count inheritances regardless of whether the recipient keeps them or passes them on to someone else. The bad result, in such cases, is that the person receiving Medicaid would be charged just as if he or she had taken the money, even if he or she gave it away, and the person’s benefits would be docked accordingly. This can be a very expensive misstep.

The better result would be to consult us immediately. We can advise you on the necessary techniques to split the inheritance between the recipient and somebody else, like a child. If the right strategies are used, Medicaid would count the inheritance to an extent, but not as much as it would have if the recipient had simply given away the whole sum.

An even better result would be if the person leaving the inheritance had consulted us first. We know how to structure that person’s financial arrangements, to protect the people to whom the person wants to leave his or her legacy.

Why You Need an Inheritance Lawyer

A Texas inheritance lawyer with experience can simplify the process of accumulating and distributing wealth for beneficiaries, family members, and heirs. Your lawyer will help you navigate the probate process, handle insurance companies, and work with real estate agents.

Your inheritance lawyer can deal with all of these matters, which will allow you to focus on other more complicated estates. Although many people fear that hiring a lawyer for these matters will be expensive, there are several flexible payment options available to your inheritance lawyer. Some lawyers will let you pay them out of the assets the lawyer collects or transfers to your beneficiary, heir, or family.

Inheriting Wealth

In the United States, more than $200 billion in inheritances are passed each year to beneficiaries. Wealth or obligations are often passed to children by their parents. This wealth could be land, jewelry, and stocks as well as businesses. This is done through wills, which must be filed with a probate judge to determine the proper heirs or beneficiaries. Without a will, the wealth is passed to the nearest relatives according to Texas law. An inheritance lawyer in Texas will be necessary to help you if the property is substantial. If a family member threatens to sue for the estate, a lawyer might be required.

Elder law is a law unto itself. We know that complicated area of the law well and we have helped many people successfully meet the challenges it poses. Please contact our Houston office at 281-214-0173 or the Bay City office at 979-318-5079 today and schedule an appointment to discuss how we can help you with your legal matters.

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