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JOINT OWNERSHIP ARRANGEMENTS
A common method of avoiding probate, or attempting to qualify for Medicaid, is for individuals to place one or more of their children's name on real estate, bank accounts, brokerage accounts, etc. For over 36 years we've warned of the dangers of placing such assets into joint ownership with children. Under the new five-year "lookback" period, such an arrangement constitutes a transfer and may disqualify the applicant for Medicaid benefits.
Once a child has received partial title to real estate, he or she is a co-owner, and title cannot be transferred by the parent without the child's consent. All too often the child refuses to permit the parent to sell the property without paying the child his or her "share of the money". Adding children to a title also makes their creditors your creditors. In other words, your home or other jointly-owned assets could be seized or attached if your child becomes divorced, is sued or runs up big debts. If you place only one child as the joint owner on all assets, then the other children may get nothing. Remember, under a joint ownership arrangement such assets pass to the surviving co-owner and circumvent provisions to the contrary contained in the decedent's Will.
Most people are better off putting their property in trust rather than transferring their property outright because of the asset protection afforded by a properly drafted trust agreement. Before making a serious and potentially costly mistake, you should consult with experienced estate planners who can provide input as to the best method of structuring your estate.
Our firm's fees are almost always significantly less than those of our most qualified competitors.
Our law firm provides second opinions concerning your current estate planning/asset protection structure.
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