Property Ownership
A Minnesota property owner is elderly and concerned about nursing home costs depleting their estate. They want to protect their home from Medicaid estate recovery. Which tool is commonly used for Medicaid planning involving real property?
ASelling the home to a family member for $1
BPlacing the home in an irrevocable Medicaid trust (at least 5 years before needing care)✓ Correct
CAdding a child to the deed as a joint tenant
DRecording a life estate with the Medicaid agency as remainderman
Explanation
Irrevocable Medicaid trusts are used in Minnesota estate planning to protect a home (and other assets) from Medicaid estate recovery. To be effective, the transfer must occur at least 5 years before the homeowner applies for Medicaid (the lookback period).
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Key Terms to Know
Joint Tenancy
Co-ownership where two or more people hold equal, undivided interests with the right of survivorship — when one owner dies, their share passes to the surviving owners.
DeedA written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).
Life EstateA freehold interest in real property that lasts only for the duration of a specified person's life.
AgencyA legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.
State-Specific Concepts
DRE Regulation
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