Nursing home (but have some assets)

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PetPal

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I'm asking this for a friend (honestly) and the scenario doesn't necessarily express my own views.

My friend's elderly father is in hospital. It looks increasingly likely the father won't be coming up, but will need 24 hour care, presumably in a nursing home. The parent owns his own house, and has a comfortable amount of cash in the bank. My friend (the son) wants the parent to get the best care he can get (in nursing home terms) and pay as little as possible. To this end, the son is considering the idea of the parent gifting the house and cash to the son, thus the parent will appear to be without funds when the time comes to look for a nursing home. (I presume the idea here is that the State will provide for the parent, but I'm not quite sure if that is the idea - I didn't ask as I didn't want to know). Anyway, the gifting of the house and cash to the son will not in itself cause any real problems (IMO) as a child is entitled to a gift of that sort of value from a parent without the child incurring much if any gift tax. (I haven't done the figures, but basically gift tax won't be a major problem). However, would the State 'look back' when assessing (means testing) the parent? Or would the State simply accept that the man has very little cash/assets currently, and has only his pension as income? If the State could/would look back, presumably then the old man would be assessed as having means (because the State would see that he had, effectively, transferred his assets)?
 
Im not sure but if there is technically no assets then that would be his current status so I doubt there is little the state can do.. Im not sure just thinkin of previous experience with my Granny, she signed over property to children before she went into Nursing home but thats over 10 years ago now??
Does your 'friend' have any siblings? If they are unaware of this transaction there is more than likely a lot of trouble ahead!! Property is the demon that always ruins families!!
 
kierank said:
Im not sure but if there is technically no assets then that would be his current status so I doubt there is little the state can do.. Im not sure just thinkin of previous experience with my Granny, she signed over property to children before she went into Nursing home but thats over 10 years ago now??
Does your 'friend' have any siblings? If they are unaware of this transaction there is more than likely a lot of trouble ahead!! Property is the demon that always ruins families!!
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No siblings, so there'll be no problems in that regard.
 
PetPal said:
I'm asking this for a friend (honestly) and the scenario doesn't necessarily express my own views.

My friend's elderly father is in hospital. It looks increasingly likely the father won't be coming up, but will need 24 hour care, presumably in a nursing home. The parent owns his own house, and has a comfortable amount of cash in the bank. My friend (the son) wants the parent to get the best care he can get (in nursing home terms) and pay as little as possible. To this end, the son is considering the idea of the parent gifting the house and cash to the son, thus the parent will appear to be without funds when the time comes to look for a nursing home. (I presume the idea here is that the State will provide for the parent, but I'm not quite sure if that is the idea - I didn't ask as I didn't want to know). Anyway, the gifting of the house and cash to the son will not in itself cause any real problems (IMO) as a child is entitled to a gift of that sort of value from a parent without the child incurring much if any gift tax. (I haven't done the figures, but basically gift tax won't be a major problem). However, would the State 'look back' when assessing (means testing) the parent? Or would the State simply accept that the man has very little cash/assets currently, and has only his pension as income? If the State could/would look back, presumably then the old man would be assessed as having means (because the State would see that he had, effectively, transferred his assets)?
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In my recent experience of my late mother requiring nursing care there is an assessment by Social Services and a great deal of form-filling. Social Services then establish how much the applicant for nursing-home care has and calculate whether they are eligible for assistance.

Your friend should urgently see a solicitor in connection with the plan to dispose of the elderly invalid's assets to find out what the legal situation is. I know if you put the estate or part of it into trust seven (?) or so years before nursing-home eventuality it is not considered to be the applicant's asset.
 
I have just remembered - at the last budget changes in financing nursing-home places were discussed. Use the search button to find the discussions. One is a 'sticky' from Brendan Burgess under Budget ; the other is a post from AJPale.
 
Marie said:
I have just remembered - at the last budget changes in financing nursing-home places were discussed. Use the search button to find the discussions. One is a 'sticky' from Brendan Burgess under Budget ; the other is a post from AJPale.
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Many thanks.
 
As far as I can recall the new nursing home charges haven't been signed into law yet but will be later this year. Who knows whether that will be before or after the election? If the government changes I'd very much doubt if the new incumbents (?) would reverse this law. I also read or heard somewhere that Age Action Ireland has had a lot of queries and concerns about this charge and may be raising it with the Minister.

On the other hand, someone has to pay for these costs and if it isn't the estate of the individual concerned, then it will have to be the taxpayer. It would be a very incompetent minister who wouldn't ensure there are no loop holes such as the one suggested.

It is my view that these charges would be far more equitable if there was a sliding scale for the % charged. After all 15% of a relatively small estate say, €400,000, would be a bigger chunk of money than 15% of an estate worth millions or multiples of millions. What I'd have in mind is something like the tax system where the lowest of incomes are excluded and highest rate wouldn't kick in until the estate exceeded a certain amount.
 
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Sherib- makes sense.

I think this is a very interesting question- can someone divest themselves of their assets in order to for eg qualify for state funded nursing homes or for eg to qualify for means tested non contributory pensions?

Is there a poster with the relevant knowledge of the social welfare system who can advise as to whether they, as part of assessing the applicants means, do searches or follow assets recently ( and if so within how many years) disposed of?

I know years ago I often acted where people turning pension age transferred a small farm to the son or daughter so they would qualify for the non-contrib pension ( not the house as I don't think this was taken into account) and kept only the amount that they werre entitled to keep and qualify for a full pension in liquid assets.

Will many people now try to divest themselves of their assets in order to avoid the new measures coming in? Is it possible to do this legally?
 
Have a look here

http://www.welfare.ie/foi/spnc.html#6.1

'
2.If you or your spouse/partner deprive yourselves of capital in order to either qualify for pension, or to qualify for pension at a higher rate, then that capital will be assessed against you as means. However, this may not apply in the case of certain family settlements involving the transfer of ownership of a farm/business.'

I don't know how this is determined. I presume the local Social Welfare Inspector would examine all relevant transactions when assessing a person's application.

Hope this helps
 
I always understood that transfer of farmland was a special case based on the logic of succession. There are previous posts on AAM (from the old EzBoard days) on the amount a parent can transfer to children and the minimum number of years (seem to remember it was about 7) before requiring residential care for it not to be counted as part of the estate.
 
That's interesting. Thanks Busymam. I expect there will be similar anti avoidance measures introduced with the the new nursing home provisions.
 
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