If My Parent Needs VA Aid & Attendance Benefits Why Would I Not Give Away His Assets to Qualify?

If My Parent Needs VA Aid & Attendance Benefits Why Would I Not Give Away His Assets to Qualify?

If My Parent Needs VA Aid & Attendance Benefits Why Would I Not Give Away His Assets to Qualify?A common strategy to help a veteran qualify for Aid & Attendance (VA Special Pension) is to give away assets because the VA rules have no “penalty” period or “look back” period which is different than Alabama Medicaid which has a 5 year look back for any gifts and penalizes families harshly for any such gifts.  (This may change soon but right now there is no such penalty with VA.  Check before you do anything as the rule may change.)

So, what is the problem or concern about giving away assets?

Here are some, but not all, of the problems or concerns:

  • The veteran loses control over the assets as the VA requires that the gift be with “no strings attached” so it is truly a complete gift;
  • Alabama Medicaid may penalize the veteran (or spouse) very hard with the “look back rule” — if $150,000 is given away and the veteran or spouse needs to go to the nursing home, the penalty period will be around 26 months that the family must pay the 6000 or 8000 a month nursing home bill;
  • If the gift is to an individual (children, grandchildren, etc) then the individual could lose the money to a divorce, lawsuit, bankruptcy or simple bad financial management.

These are concerns that should be addressed in a very open and blunt meeting with an Alabama Elder Law Attorney.

To be blunt, the rules of the VA don’t always make sense to families.

Especially the rules of the Alabama Medicaid — these often don’t make sense to most people.

Throw in the family dynamics and the need to ask the children “What is your financial condition?” and “How is your marriage?” and similar tough questions.

This can become very complicated and difficult.

This is why we suggest you have a road map that gives you, like a GPS today, the path from where you are now to where you want to go.

A path that avoids the dangers and maximizes the odds of getting to your destination safely.

Gifting can be a wonderful strategy and can enable a family to receive the VA benefits that can make all the difference in the world — over $25,000 a year.  

Over five years this can be $125,000.

But you need to be careful and make sure any decisions you make, any transfers of property, any gifts, have been well thought out as part of an overall plan or road map.

Contact Us.

If we can help you with any aid & attendance questions, give us a call at 1-205-879-2447 and ask to speak to Carolyn.

She can set you up with a morning appointment.

Or you can fill out our contact form here on this website.  

We look forward to learning more about your situation so we can help you discover the best path.

Thanks for reading, and have a great day!

-John G. Watts

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