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FAQs #27

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Q27. My mother is no longer able to live alone and care for herself. She has six daughters. Four daughters live close and are willing to care for her either in their home or in her home. We are taking turns spending a few days each caring for her day and night.

I am trustee of her bank accounts and power of attorney of her health care. How can I use some of her money in the trust to pay us daughters for caring for her. We have lots of expenses of food, cleaning, laundry, personal products , travel expenses and the job of caring for her 24 hours a day. What are Medicare/Medicaid rules and tax problems if I use money in her trust to cover expenses of caring for her. We don't know how long we can care for her in her home and at what time she might need nursing home care. At present with help she can get to bathroom and table for eating. She cannot be left alone but is not bedfast yet. Thanks, Gladys

A27. Elizabeth Kelly, Elder Law Attorney:
Dear Gladys,

If your mother will need to rely on Medicaid for long term care, either in-home on one of the waiver programs, or in a long term care facility you will need to be very careful about paying family members for providing care. In Colorado , the Medicaid rules were recently changed in this regard, placing restrictions on paying family members for such services.

There is an exception to the Medicaid transfer of assets rules that permits the transfer of a home to a son or daughter who provide care to a parent for two years prior to applying for Medicaid delaying the need for Medicaid/long term care. However, there are some requirements associated with proving that the care actually did prevent premature placement. You should consult with an Elder Law Attorney in your area. To find an attorney who is a member of the National Academy of Elder Law Attorneys, you can check NAELA's web page.

Best wishes, Elizabeth A. Kelly

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