What happens in a 'joint account'

carrie630September 17, 2010

I guess I already know the answer - How easy it would be to be 82, not in a home, open a savings account - let's say 50,000 - a check from her brother - and put my name jointly on the account.

That's her money, right? If she goes into a home - that's part of HER assets, right?

It's obvious. Otherwise, everyone would be taking their money and putting it in a joint account.

But, here's my question. Can I withdraw any money from that myself (with her knowledge of course) but then if she went into a home - make sure it is not spent in case they come back to me because that money was considered HER assets?

Hope I made sense with the above post - as you can all imagine - I have NO IDEA what I am talking about lol


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Please understand that I am not an attorney. I suggest you find an elder care attorney and get advice as soon as possible. I'm a daughter who's dealt with some of these issues. My understanding is is that if you have a joint account with your mother, that money would be counted as part of her assets and would have to be spent before she would qualify for Medicaid. Yes, you could write a check from the account and attempt shield the money. However, my understanding is that after your mother's death, the Medicaid asset recovery group (whatever this agency is called in your state) could audit her accounts and demand that you explain what happened to that money. They could sue you to recover.

Welcome to the wonderful world of confusion/frustration known as Medicaid rules. Good luck!

    Bookmark   September 17, 2010 at 9:04AM
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Carrie, I think it kind of depends on what you're spending the money on if you withdraw it. (Again, not a lawyer.) After my dad died and I got Power of Attorney for my mom, we put my name on her checking accounts so that I could pay her bills, as she's not able to handle money (Alzheimer's). I make sure to keep copies of all the bills I've paid, and I always make sure each check is noted in the register. I also keep all receipts for the money spent on her prescriptions.

It's hard enough to care for one's parents as they age, but taking care of the finances is doubly difficult. My parents were so frugal, I know that if Mom realized we are paying over $2,200 a month for her apartment at the retirement community/assisted living facility, she'd come unglued. As it is, she doesn't ask those types of questions anymore. We have maybe enough money to pay out of pocket for a couple of years. I'm going to file for Veteran's Benefits for my mom to try and supplement this, as my dad was a WWII veteran. Best of luck to you!! You're not alone in this journey, for sure.

    Bookmark   September 17, 2010 at 2:54PM
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Actually, this is a savings account set up from money she just received from her brother... over 50,000. She put my name as joint on the savings, but I told her that it was NOT my money, but hers.

I guess, since she is the primary on the joint - that is considered part of her assets. She is under the impression that if she went into a home, that money would be for me to do what I want. I explained to her that it would not be mine... but hopefully with this appointment we have with the lawyer next week, he can make her understand all about it being part of her "assets"

This is soooo hard - I wish she would just spend that money on herself and her husband and enjoy her life - she's saving it and that is so frustrating.

    Bookmark   September 17, 2010 at 3:39PM
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POA account is not the same as "joint". With joint entry on the account, I suspect you'll be told that 1) you will have access to 100% of the account at any time for any purpose (which you will not have to disclose) with or without her knowledge and 2) The IRS will regard 50% of the amount placed in the account initially as a gift to you to be counted as a reduction in the unified credit upon death. The 50% number will be reduced by the individual gift-exclusion amount which is currently $13,000.00.

If you have medicaid concerns, be assured they will find it and consider it.

Would be interested to learn of your lawyer's feedback if you're comfortable in sharing.

    Bookmark   September 17, 2010 at 4:11PM
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Uh oh - wait a minute

If there is 60,000 in the account - and she just made me joint, I have to pay tax on it? Explain please, if you can - I don't consider that my money but of course my name is on it and I have no intention of withdrawing anything - I consider it her money - but she didn't want that money divided up between stepchildren because it came from her sister.. that's why my name is on it

    Bookmark   September 17, 2010 at 5:39PM
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In other words, if she died, she didn't want that money going to anyone but myself... She is NOT in a home and she is 82 years of age.

I am confused by the 13,000 - They had wanted to give us all 13,000 each - but if both of them (age 89 and 83) ended up in a home within the next five years - that's money that would be considered to be "paid back" in order to pay for care ... until all assets run out in order to apply for Medicaid... right?

;0/ so confused...

Carrie PS Thank goodness I've set them up with an attorney - too bad I am years too late with this - thinking they had taken care of business 20 years ago - but they didn't and haven't a clue that they shouldn't be giving us any money right now -

    Bookmark   September 17, 2010 at 5:45PM
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Besides the money issues, please make sure that you address the issues of powers of attorney, both financial and durable, and advanced directives.

Here's a website for a California attorney, and he's got great advice. I suggest that you read the columns.

But please know that every state will have differences, so make sure that you are proper for the state where your parents live. Just know the questions to ask.

Here is a link that might be useful: Elder Law attorney

    Bookmark   September 17, 2010 at 6:40PM
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Calm down. Everything's fine. You have an appointment with an attorney. He/she will explain it all to you better and more understandably than I would by taking several paragraphs here. No, you won't have to pay taxes on it....but the estate might if it's large enough. Really....it's OK. Don't worry between now and then.

    Bookmark   September 17, 2010 at 7:25PM
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Thanks - you are very sweet to "calm" me down - I am really okay - sounding on this board a lot more worried than I am - especially because next week all of their questions will be answered (along with mine) but many people on this board have questions (and answers) that bring up subjects I might not have thought about.

Thanks so much... now, on to another thread with ANOTHER question

    Bookmark   September 17, 2010 at 7:48PM
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