My father owns his home free and clear (approx. value $150K). He needs to move in with me and my husband to care for him and also thereby avoiding assisted living. He wants to give me $50K towards the down payment of a new home large enough to accommodate him, me and my husband. In turn, he would give $50K to my only sibling (to keep things even between us). The remainder would go in the bank. Can he gift the proceedings from the sale of his home to my sibling and I without capital gains tax and/or penalty of any type? Does the sale of his home affect Medicaid/Medicare in any way?
1 Answer from Attorneys
I don't render tax advice but I can say that giving you 50K is problematic if your father currently receives Medicaid or has to apply for Medicaid in the next 5 years. The sale of his home, similarly, will also impact Medicaid eligibility.
However, there are legal and ethical ways to transfer 50K to you and sell the house/shelter assets in a way that will not impact Medicaid eligibility.
Happy to discuss if you would like to explore these options further.
Best of luck to you.
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