Q: My uncle is about to have surgery for cancer, and he doesn’t want his children to have his assets as they are estranged, and I have taken care of him for the last several years. How can we avoid paying inheritance tax if we transfer his house to me? (McMurray, PA)
A: Have him consult with an estate planning lawyer as soon as possible. Transferring real estate is easy to do, however, the person making the transfer must be fully advised of the consequences. If he deeds his house to someone and survives one year after the transfer, there will be no inheritance tax. However, he really needs to be apprised of whether this transfer is right for him. He may need his house to sell to pay for nursing assistance or institutional care in the future, among other future scenarios. The attorney will need to know or determine. What is his immediate medical situation? How likely will your uncle need Medicaid in the future? If he transfers this house and within the next five years applies for Medicaid, he may be penalized by Medicaid which could force the sale of the house. Does he have long term disability insurance? Does he have other assets to liquidate in order to sustain medical treatment?
Q: My family owns 52 acres. The property was my dad and uncles and my dad’s part went to my mom when he died. I lived there for over 23 years in the main house but moved into an RV on the property so my mother, sister, and her husband and kids could have the house. I alone paid the 2-year delinquent property taxes. Before that we had all pitched in on them. Then recently, my sister and I had a falling out and my wife and I left for a few weeks to let things calm down and in our absence my sister sold my RV, kept the money, and told my mother that if she allows me to come back to the property, that she will move away and no longer provide care for her. Don’t I have some legal right to be there since I paid the $10,000.00 in back taxes? Can I file charges against my sister for selling my RV?
A: Based on the facts you have given, if your mother and uncle are on the deed to the property, your mother and uncle are the only ones who can exclude you from the property. The only way your sister can legally exclude you from the property is if she is acting under a Power of Attorney for one or both, or gets a court order which bars you from the property. The fact that you paid real estate taxes for them alone gives you no right to be on the property without your mother or uncle’s consent. And yes, if you owned the RV, and have proof your sister sold the RV, you may have a civil claim against her, and she may have even committed a crime. If this was someone else’s RV, like your mothers, and you don’t own it, your sister may be liable for your belongings inside. She basically evicted you without following the law and converted your personal property inside the RV.
Q: My mother was recently diagnosed with late stage cancer. Two years ago, she divorced her husband and remarried. Before remarrying, she placed her divorce settlement in a savings account with me (her only child) as the sole beneficiary. My mother’s new husband is not named on the account and the money was all hers before they married. My mother wants me to get all the money in this account. Does she need a will to state this or is me being the sole beneficiary enough? Does her new husband have any claim to the money? How does she make sure that her wishes are carried out? (Greentree, PA)
A: I am sorry to hear about your mother’s diagnosis. If you are a named beneficiary, the money passes to you upon the death of your mother and does not become estate/probate property and therefore does not pass to the heirs in her will. In Pennsylvania, her estate or you, depending on how the will reads, would pay inheritance tax on this. In Pennsylvania, a spouse who believes he or she was disinherited by the will, or not left enough money by the will, can challenge the will by “electing” to take against the will. This election must be filed in the Register of Wills within 6 months of death or 6 months of probate. This means the disgruntled surviving spouse who elects to do so, may choose to not inherit through the will but instead take a percentage, one-third, of certain non-probate assets. The PA statute on this is arcane and convoluted and difficult to understand. If you think it is a possibility that your stepfather would challenge your mother’s will, you may want to consult with an attorney now. The attorney would need to know the extent of your mother’s present assets and do the math on what potentially her husband would be entitled to under PA law. Keep in mind that as your mother owns this account, you have no right to it while she is alive, and she may liquidate it as needed to pay for her care as her needs increase with age.
Q: My mother has Parkinson’s Disease and father has Alzheimer’s disease. My niece just had paperwork sign giving her power of attorney. I’m one of three sons. Is their anything I can do to claim some of her estate? (South Hills, PA)
A: Their Last Will and Testaments determine to whom their property passes upon death. A Power of Attorney does not empower an Agent (your niece) to make a new will for the Principal (your mother and father). A Power of Attorney does not permit an Agent to make gifts to themselves or others, change beneficiaries, or take a fee for services unless the wording of the document specifically allows them to do this. If your parents POA does not have such language, their money can only be used to pay for their own needs. After the survivor of them passes, what is left of their estate, after taxes, debts and taxes are paid, will pass to the heirs named in their Will, or if there is no will, to the heirs under PA intestate law. If you have evidence your niece is taking advantage of your parents, consult with an attorney about becoming their court-appointed guardian.
Q: I am getting older and want to add my son to the deed. How do I do it? (Pittsburgh, PA)
A: It is easy to do. You just hire an attorney to prepare a new deed with your son’s name on it. You can put him on the new deed with you or you can leave him on the deed alone. All you would pay is an attorney fee to prepare the deed and the filing fee. However, a word of caution before you do this. Please consult with an attorney with whom you can share all the facts before doing this. This may or may not be advisable for you and an attorney can only make the determination if he has information on your other financial assets, your health, your health insurance, your potential of needing Medicaid, your income and the stability of your son.
Q: My mom is taking care of our step-father at her home and we don’t know how much longer she can. He has Parkinson’s Disease. My mom is 82 and she has health problems also. She is on Xarelto. (Somerset, PA)
A: This is too complex of a question with too little information to answer. If either or both of your mother and step father are on the deed, and in the next five years should need to apply for Medicaid, yes there may be an issue. Medicaid has a 5 year look back on transfers for no consideration (gifts). Also, if either needs to liquidate their property to pay for nursing care, that is their right, as it is their property. If they are concerned, have them make an appointment with an attorney who is versed in estate planning and Medicaid regulations.
Q: My mother became POA of a neighbor as someone was taking advantage of the neighbor and my mother felt empathetic for this woman who was her friend. The woman has since had a change in her health and is now living in a skilled nursing facility with dementia. My mother has fallen ill herself now and is unable to serve this woman as POA and she would like to remove herself from POA. Is this possible? (Pleasant Hills, PA)
A: Yes, of course. Most Power of Attorney documents contain language that state that the within power of attorney can be revoked in writing. It would be prudent for her to write a letter in which she states that she can no longer serve as Agent for her friend. The letter should be served on her friend, the facility in which she resides and any other medical provider who may have relied on the document in the past.
Q: I don’t know what I need to do with lacking only about 10 payments to paying home off. When I got sick about 7 years ago my daughter took care of me. Now she gave her job up about 2 to 3 years ago when I needed her all the time. A friend said maybe a trust? I just am not sure what or if anything I can do I have my state retirement, survivor’s benefits and social security saved. (Ohio Twp., PA)
A: I am not getting everything needed to be known to answer this question so I urge you to consult with an estate or elder law attorney who can get all the facts. Of course, you can have an attorney draft a POA which authorizes your daughter to act on your behalf. If you may need Medicaid funding in the future you may be able to shelter some of your assets and take advantage or caretaker contracts and a hardship exclusion to save the home.
Q: I moved in with my mom about 2 years back. We got my name on the home, so this is all done. My mom is in her late 80’s and I have two brothers on SSI. I know about the 5 year look back period. One of my brothers still wants our mom to help support him, I have explained to her I do not have an issue with this- however, I told her if she needed care from Medicaid, then what funds she give him, the money has to come from some place so I would have to pay it. I am not willing to support my brother. So, what do I need to do to prepare for the lawyer- just state what I have said here? (South Fayette Twp., PA)
A: Consult with an attorney versed in Medicaid regulations. It sounds like you are aware of the impact of Medicaid in that money paid to the brother could be considered gifts or transfers without consideration during the Medicaid look back period of 5 years and render your mother ineligible for Medicaid benefits to the extent of the value of the unauthorized transfers. An attorney may be able to utilize a caretaker contract between you and she to shelter some of her money and advise you on how you can utilize your move-in caretaker status to possibly shelter your mother’s home from Medicaid Estate Recovery.
Q: Our dad was hospitalized with a stroke and pneumonia, and he has a will. My sister and I knew we were getting this property in the will, but the will was 125 miles away and we did not want at that point to leave his side for that length of time to see what the rest of the will read for fear of him dying before we returned. He could not speak because of the stroke so we had to ask questions and he would answer yes or no by hand squeezes. He instructed us to transfer his house through power of attorney to our joint names and we did. It turned out we probably should not have, because I think he was not thinking properly at that point do to drugs and the stroke, and my sister and I were grief stricken and tired from being by his side until he died. Since we were getting the house by will anyway, in hind sight it did not seem to make any sense to transfer it, so we figured he knew something we did not. But, I do not think he was thinking right at that time. (Pittsburgh, PA)
A: Assuming the POA authorized you to transfer real estate or make gifts to yourselves, and even if it didn’t, if no other family members are complaining or you haven’t violated state law, you should be OK. No harm, no foul. If, on the other hand, you transferred his real estate to yourselves with the POA when other family members were to inherit the real estate through the will, there might be a concern. In PA, a transfer in anticipation of death (within 1 year) will subject the entire value of the property transferred to inheritance tax with a $3000.00 exclusion. The only other concern would be Medicaid. If your father was receiving Medicaid benefits, they may have a claim against his estate. If you transferred property out of his estate, Medicaid will have a claim against the real estate as part of his estate as it was transferred in anticipation of his death. If you did this transfer with knowledge of his Medicaid status, you have committed Medicaid fraud but will probably not be prosecuted criminally if the house is still in your name.