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Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 29535
Experience:  Taxes, Immigration, Labor Relations
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Hi, My mom who is 75 years old, lives in Fairfax county, in

Resolved Question:

Hi, My mom who is 75 years old, lives in Fairfax county, in Virginia and receives SSI and medicare from social security.
She is planning to inherit her condo which is value in $180000 to her son.
She still has $80,000 left balance in mortgage. Her son is willing to pay off. What happen to her SSI and medicare? Can she still get those help or get cutting off from SSI and medicare?
I heard if she sells her condo and get profit over $3000 then her SSI and medicare will be cut off.
Submitted: 5 years ago.
Category: Tax
Expert:  Lev replied 5 years ago.

Hi and welcome to Just Answer!

If your mother receives social security benefits based on her earning records and Medicare based on her age - these benefits will not be affected.

However - if she receive Supplemental security Income (SSI) and Medicaid which are need based - these benefits might be affected.

 

If she wants to give her property to her son while she is alive - that is a gift and not inheritance. Her gift is equal to the fair market value of the property minus the mortgage balance her son is willing to assume.

 

The issue that she will face when the time comes to apply for Medicaid (Title 19) benefits or any other need based benefits. Technically, all of the applicant's countable resources should be used to pay for these benefits. Any gift made within five years of the application will create an automatic period of Medicaid ineligibility based on the amount of the gift.
Federal law requires each state to have Medicaid recover program and a lien will put on the property. If the property will be sold - part of proceeds owned by your mother should be remitted to Medicaid.

Lev and other Tax Specialists are ready to help you
Customer: replied 5 years ago.
Your answer stated that "However - if she receive Supplemental security Income (SSI) and Medicaid which are need based - these benefits might be affected." How much would the SSI be affected?
Expert:  Lev replied 5 years ago.

If the amount she will continue to use the property as her primary residence - her benefits should not be affected - but the state will put a lien on the property for at least five years.

If she moved out of property before five years - the property will be ceased by the state.

In additional - a fair market rental value will be considered as her income provided by her son - and that might affect her SSI amount.

I may not say what exact effect would be as that is based on many factors.