Legal Question in Real Estate Law in California

1. If your mother is alert and mentally competent to make good decisions, she is probably able to execute contracts, including deeds. Nothing in what you've said (90, on Medicare, etc.) points to a mental incapacity. However, that's only half of the answer. If you and she cook up a scheme to try to place her property outside the reach of Medicare or MediCal by transferring it to you, the transfer would probably be fraudulent under the California version of the Uniform Fraudulent Transfer Act, which can be found at Civil Code sections 3439 to 3439.12. If she is only giving you a half interest, that somewhat lessens the likelihood of MediCal claiming it is a fraudulent transfer, but the suspicion might still arise. Better read and understand the definitions given in the Code before attempting this.

2. There are two possible aspects to this question. First, the government might assert a fraudulent transfer allegation if there were unpaid medical bills. Second, when you eventually sell, the capital-gains tax on property received as an inter vivos gift is in all probability going to be way higher than if you had waited to inherit a 100% interest by will or through a trust. This is because when you inherit, you get a step-up to then-current market value as your "cost" in the property, whereas if you get a gift, the house or your half interest continues to have mom's cost basis, which is probably very low compared with what the value will be when she dies. If you get a gift of a half interest, your capital gain on that 1/2 is based on the difference between the selling price and what mom (and dad) paid back in 1955.

3. MediCal is quite aggressive about pursuing claims for reimbursement of monies it advances to pay medical expenses. Any property your mom had while receiving public aid is potentially subject to a claim for reimbursement. The claims-reimbursement worker bees at MediCal regularly comb county records for property ownership and property transfer records that may reflect an asset that is or was owned by a beneficiary of public assistance and that needs investigation as a possible source for reimbursement. This is not quite the same as making you pay for your mother's medical expenses. Instead, it is making mom's former property pay up before the property goes permanently to someone else -- a kind of lien concept.

Mr. Whipple gave you a REALLY good answer. The short version is "It's a really bad idea, a losing proposition once taxes are included, and it could really come back to bite you hard." Come up with another plan.