Understanding Life Estates
Transferring one’s home to another person or persons, subject to a life estate, has been a staple strategy of elder law planning for a very long time. Medicaid planning typically involves an individual divesting himself/herself of assets in order to become eligible for long term care coverage via the Medicaid program at some point in the future. Often, when engaging in Medicaid planning, one is faced with negative tax consequences when transferring assets directly to others.
