Homestead Exemption and Residency Requirement

[lezah]

I own a house that my mom lives in. I gave her life estate. She can live there as long as she is able to. After that the house can be sold. She is 87 and not able to be alone. I stay with her all day and sometimes at night. If I don't stay at night my sister does. She is never alone. I also own a house with my husband. The house that my mom lives in is just mine. The houses are next door to each other. Do I need to put my mother's gas and electric bills in my name to show ownership of the house. We have no intention of putting her in a nursing home. We are going to care for her at home. I took care of my father the same way. His wishes. I am just wondering if someday when I sell the house will I be able to use the two year rule when I already own another house with my husband. What do I need to do to use that law? Please help.

[Anonymous]

I assume you are speaking of qualifying for the homestead exemption. For that exemption to apply you need to own a home and use that home as your primary residence for not less than two of the previous five years. Presumably the house is titled in your name, so you own it. If you meet the residency requirement, you can even rent the home during the period leading up to the sale, so there shouldn't be any problem having the bills in somebody else's name. The bigger question seems to be whether, given that you have a permanent residence next door (and presumably have used that residence as your legal address for such things as your driver's license, mail, bills, etc., without interruption), you can make a convincing claim to have used the second home as a primary residence.

[lezah]

Yes, I was speaking of qualifying for homestead exemption. Is there any way in the future that I would be able to do this? Or would I have to sell my home next door first that I lived in 20 years and live in my Mother's house first 2years. Is there any other way around this? A friend told me that since I legally gave my Mom life interest [only as long as she was able to live in the house] that is she ever went on medicaid that they would take my house. How is that possible? The house isn't hers. I only gave her life interest in case something happened to me so she would always have a place to live. Did I make a mistake? Thanks for your help. Just trying to find answers in case I have to make decisions to move my Mom into my house or we have to move into hers.

[Anonymous]

You may wish to speak with an attorney who specializes in Medicare planning about your mother's situation.

I'm not going to speculate about the value of the life estate, but I don't give much credence to your friend's assertions. The most that could be claimed against your mother's estate would be the value of the life estate, and that may well be an exempt asset - the circumstances are a bit unusual so I don't know how the life estate would be regarded for purposes of Medicare eligibility.

[lezah]

Thanks Arron. My family attorney said since the house wasn't Mom's and we weren't trying to hide assests so we don't have a problem. That only becomes a problem for people who transfer houses trying to get on medicare. That isn't our case. Guess I better quit listening to well meaning friends. I guess as far as the tax deduction goes I would eventually have to live in the house sometime in the future for 2 years as my home to claim that. Thanks for your help.