Gift giving

UPDATED: Oct 1, 2022

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Gift giving

My aunt and uncle are residents of PA. They
were told that they cant give monetary gifts
over 500 per month because if my uncles
health declines any further then their daughter
as the receiver could be sued for the money
back up to five years. Is this true?

Asked on December 25, 2018 under Estate Planning, Florida


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

If someone goes into a nursing home or gets other care paid for by Medicaid, then the state agency paying can look to recover any amounts that person transferred to others, including family, which were not transfers made for "fair market value" (i.e. when you buy something from someone for what that item or services are actually worth). They can recover transfers made up to 5 years prior to Medicaid starting to pay. This is done to prevent people from "hiding" their assets with family or friends or giving gifts to family and friends while then forcing the taxpayers to pay for their medical care.
Generally, gifts of up to $500/month are allowed, but over that amount, the state can look to recover--i.e. sue, if necessary--the money gifted within 5 years of Medicaid starting to pay.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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