Legal Question in Wills and Trusts in Massachusetts

Re: Buying a parent's home under market value

The answer is a qualified "maybe" based on how the transaction is structured, the amount that is deemed a "gift" and the timing involved. Massachusetts has a 60 month "look back" period, so if your parents predict they will need nursing home care in the next 3 years, this conveyance would fall within that time period thus making the structure of the transaction critical.

If your parents would like to structure a conveyance of the home, I would be happy to work with them.

Re: Buying a parent's home under market value

This is a potentially very tricky question for all parties concerned, and cannot be answered in this format because the facts will determine whether the purchase would be treated as a Medicaid-disqualifying gift by MassHealth.

How much under "market value" are we talking about? What are the terms of the purchase -- outright cash versus a mortgage? If this is a mortgage, will the terms conform with MassHealth requirements? Have the parents determined the income tax implications of the sale?

I have practiced elder law since 1998 and am an active member of the Massachusetts chapter of the National Academy of Elder Law Attorneys. I would welcome the opportunity to consult with your parents to determine whether this proposed transaction will meet whatever their goals may be.