A Medicaid law, known as the Look-Back Period, imposes a penalty if you transfer assets within five years of applying for Medicaid. It is challenging, but if you can show you made the transfers for a purpose other than to qualify for Medicaid, you may be able to avoid the penalty imposed by this law.
The purpose behind the law is to prevent an elderly person from giving away valuable assets to meet the income and asset eligibility requirements to qualify for Medicaid. The government goes back five years to search for the transfer of any asset and levies a penalty if those assets were transferred without receiving fair market value in return.
To avoid a penalty period, you will need to prove that you made the transfer for a reason other than qualifying for Medicaid. The burden of proof is on the Medicaid applicant and it can be difficult to prove. The following evidence can be used to prove the transfer was not for Medicaid planning purposes:
If you made transfers in the past and are now applying for Medicaid, consult with Stouffer Legal at 443-470-3599 to determine if the transfers can avoid the Medicaid penalty.