Question About Bankruptcy and $$ in the Bank

[cornflake]

K, edited for clarity, but left as mediwhatever because a. otherwise the following posts make no sense and b. I think others confuse the two as well so just correcting the term may not clarify for other people reading.

 

[Pea-n-Me]

I think others confuse the two as well so just correcting the term may not clarify for other people reading.

I thought clarifying Medicaid rules was a major point of this thread, lol. (Bankruptcy issue notwithstanding.)

 

[ccgirl]

I've decided I don't like being put in this position with Mom's money.

I'm an only child so there is no one else to deal with it, unfortunately.

Dad had Alzheimer's, and Mom took care of him at home for several years, until he started getting violent at night. They called it "sundown syndrome." He got physical with her and she feared for her life. As a family it was decided he needed to be put into a nursing home. He worked all his life, the last 25 years at General Motors. They were not good at saving money. They sold their home and moved into a senior citizen apartment building. It was determined they could not afford, on their own, to pay Dad's way in the nursing home and the home started the paperwork for Medicaid. They advised her to speak to a lawyer. She (and I went with her) spoke with the lawyer at the Commission on Aging and the lawyer recommended "spending down" any assets.

They didn't have much $$ in the bank so there wasn't much to "spend down." The nursing home said she could put $2,000 into a savings account in Dad's name for incidentals (hair cuts, clothes, anything personal he needed) so we did that, with my name only being on the account as having power of attorney.

So, when he died we tried to transfer his savings (he still had the original $2,000, as he died 6 months after going into the nursing home) to her account and it wasn't allowed since my POA was no longer valid after his passing. We had to go through probate to get the money transferred, and pay fees to do that.

So, when Mom cashed in the life insurance policy she wanted to put it into the bank in my name only so her name wasn't tied to it. Yes, just in case she had to go to a nursing home. If some of you think that's wrong, so be it. It's what she wanted to do. I never thought there would be any kind of issues because to me it is HER money, NOT mine. I guess to the law that's not the case.

Someone mentioned gift tax, she didn't give the money to me. It is HER money, just in my name. And the premiums to the life insurance policy were paid by my Dad, from his income which was already taxed so why would it be taxed AGAIN?

This is just proving to be more trouble than it's worth and I'm wishing I would have said no when she asked to put it in my name. But I never thought there would be issues so I had no problem with it.

We are going to the bank this afternoon, to talk with them (I'm sure they've had other issues with people filing bankruptcy), and if need be we'll be walking right across the street to the lawyer's office to make an appointment.

I HATE that our son is planning to file for bankruptcy. I am a firm believer in a person paying their own debts so I totally disagree with him on what he's going to do, but I have no control over what he does. I just wish I never, never, NEVER would have added his name to the account.

I thought I was protecting my Mom's money, so nobody would have to pay to have it transferred to another account if DH and I were killed in an auto accident or something. And here I may be just causing more headaches.

I don't know why I missed it the first time. Found it. If your mom accepts Medicaid without using her own money first, that is fraudulent and against the law. Your son filing bankruptcy is well within the law so not sure why you are mad at him and not your mom when she is the one breaking the law. I know....a lawyer told her to do it. Like I tell my DD, just because someone tells you to do something wrong does not make it magically right. Medicaid is there for those that do not have any money. By your mom using that money when she does not need it (due to the life insurance policy she hid under your name) she is taking the money from someone who really needs it. You say you are a firm believe in someone paying their own debts, then your mom should use the money before she takes the Medicaid and pay her own debt (the nursing home) instead of relying on taxpayers.

 

[manning]

Haven't read much but

Before you do anything do what your mom should have done before putting any names on anything

Go talk to a financial planner/attorney and find out what the consequenses are.

I would have kept it in my name and issued power of attorneys. That said without knowing anything.

 

[runwad]

I'm confused on something I'm reading here. My MIL is in a private pay nursing home. FIL is spending down paying for her care, but he is entitled to keep so much in his name, plus his house and a car. Am I understanding that if MIL goes on Medicaid then when FIL dies, his assets would then go back to MIL to pay off her past Medicaid use? We do have an estate attorney but DH handles all this since it's his parents. I just didn't realize that if something happened to FIL his assets would then pass back to MIL. Which if she is still alive and in the nursing home I'd understand that but if she dies first does his estate go back to the state to pay off her Medicaid assistance. I guess that is my question.

 

[sookie]

Did the op abandon this thread? I never get why people ask for advice then bail ship.
OP, let us know what the attorney said... many of us are very interested!

 

[Klismania]

Did the op abandon this thread? I never get why people ask for advice then bail ship. OP, let us know what the attorney said... many of us are very interested!

I totally get why people do this. In this example, the OP asked about a potential bankruptcy issue her son was having. She didn't ask for a lecture about how her mother handled her money nor did she ask for all the judgement heaped on her head. If I walked into a room full of people and asked if anyone knew anything about bankruptcy laws, explained the situation and suddenly 10-20 people started wagging their fingers in my face about my mother, I'd walk out, too.

FTR, what makes me roll my eyes is everyone piling up on the little guy but saying nothing about (or even vehemently defending) all the huge corporations in America that pay little to no taxes at all, polute everyone's environment, rob/exploit our people blind, and give themselves multi-million dollar bonuses and pats on the back for doing so. Talk about missing the big picture! Whew!

OP, ignore the crap you've heard here. Consult an attorney and follow HIS/HER advice.

Free advice, especially from bitter, judgemental strangers, is worth less than what you paid for it.

 

[Uncle Remus]

I totally get why people do this. In this example, the OP asked about a potential bankruptcy issue her son was having. She didn't ask for a lecture about how her mother handled her money nor did she ask for all the judgement heaped on her head. If I walked into a room full of people and asked if anyone knew anything about bankruptcy laws, explained the situation and suddenly 10-20 people started wagging their fingers in my face about my mother, I'd walk out, too.

FTR, what makes me roll my eyes is everyone piling up on the little guy but saying nothing about (or even vehemently defending) all the huge corporations in America that pay little to no taxes at all, polute everyone's environment, rob/exploit our people blind, and give themselves multi-million dollar bonuses and pats on the back for doing so. Talk about missing the big picture! Whew!

OP, ignore the crap you've heard here. Consult an attorney and follow HIS/HER advice.

Free advice, especially from bitter, judgemental strangers, is worth less than what you paid for it.

This.

 

[YodaGirl]

I totally get why people do this. In this example, the OP asked about a potential bankruptcy issue her son was having. She didn't ask for a lecture about how her mother handled her money nor did she ask for all the judgement heaped on her head. If I walked into a room full of people and asked if anyone knew anything about bankruptcy laws, explained the situation and suddenly 10-20 people started wagging their fingers in my face about my mother, I'd walk out, too.

FTR, what makes me roll my eyes is everyone piling up on the little guy but saying nothing about (or even vehemently defending) all the huge corporations in America that pay little to no taxes at all, polute everyone's environment, rob/exploit our people blind, and give themselves multi-million dollar bonuses and pats on the back for doing so. Talk about missing the big picture! Whew!

OP, ignore the crap you've heard here. Consult an attorney and follow HIS/HER advice.

Free advice, especially from bitter, judgemental strangers, is worth less than what you paid for it.

Bingo.

And unless you've dealt with a situation similar to the one with OP and her mom, it can be difficult to understand why things have to be done a certain way.

 

[Pea-n-Me]

I totally get why people do this. In this example, the OP asked about a potential bankruptcy issue her son was having. She didn't ask for a lecture about how her mother handled her money nor did she ask for all the judgement heaped on her head. If I walked into a room full of people and asked if anyone knew anything about bankruptcy laws, explained the situation and suddenly 10-20 people started wagging their fingers in my face about my mother, I'd walk out, too.

She asked for information and she got it. The issue happens to be a sensitive one because of the nature of the subject.

Free advice, especially from bitter, judgemental strangers, is worth less than what you paid for it.

You seem to be doing the same thing you're accusing others of doing.

 

[mhsjax]

I totally get why people do this. In this example, the OP asked about a potential bankruptcy issue her son was having. She didn't ask for a lecture about how her mother handled her money nor did she ask for all the judgement heaped on her head. If I walked into a room full of people and asked if anyone knew anything about bankruptcy laws, explained the situation and suddenly 10-20 people started wagging their fingers in my face about my mother, I'd walk out, too.

FTR, what makes me roll my eyes is everyone piling up on the little guy but saying nothing about (or even vehemently defending) all the huge corporations in America that pay little to no taxes at all, polute everyone's environment, rob/exploit our people blind, and give themselves multi-million dollar bonuses and pats on the back for doing so. Talk about missing the big picture! Whew!

OP, ignore the crap you've heard here. Consult an attorney and follow HIS/HER advice.

Free advice, especially from bitter, judgemental strangers, is worth less than what you paid for it.

I think you may be my new best friend.

 

[PeterPan09]

This thread is why the self-righteous LOVE the Internet. Imagine, there was once a time in our world where all these perfect people could only exalt their superior wisdom locally. Today, those same people can find endless joy in telling the world how they worked hard their whole lives, never got any help from anyone, paid all their bills and always planned financially for any and all circumstances.

Of course, since this is the Internet, the amount of self-righteousness could be inversely proportional to the reality of those same people being in debt up to their armpits and completely dependent on other people's money to survive.

 

[Rabscuttle]

Did the op abandon this thread? I never get why people ask for advice then bail ship.
OP, let us know what the attorney said... many of us are very interested!

After a 126 posts? Where is that dead horse icon when ya need one!

 

[maxiesmom]

This thread is why the self-righteous LOVE the Internet. Imagine, there was once a time in our world where all these perfect people could only exalt their superior wisdom locally. Today, those same people can find endless joy in telling the world how they worked hard their whole lives, never got any help from anyone, paid all their bills and always planned financially for any and all circumstances.

Of course, since this is the Internet, the amount of self-righteousness could be inversely proportional to the reality of those same people being in debt up to their armpits and completely dependent on other people's money to survive.

How can anyone be suprised when they post about how they scam and cheat that they get called on it? Don't want to be raked over the coals for your wrong-doings? Don't post them on a public message board! It is not that hard of a concept.

 

[PeterPan09]

How can anyone be suprised when they post about how they scam and cheat that they get called on it? Don't want to be raked over the coals for your wrong-doings? Don't post them on a public message board! It is not that hard of a concept.

That breeze you felt was the point of my post passing you by.

Of course, posting about cheating is going to get you criticism. My post was aimed in a different direction.

 

[maxiesmom]

That breeze you felt was the point of my post passing you by.

Nope, it didn't. I'm just not stupid enough to come here and post my wrong doings on a public forum. Not unless I want a good smacking. I put my foot in my mouth enough without meaning to, I'm not going to start by going "Hey, I'm doing this thing that is wrong, and maybe illegal. But that is besides the point. What I really want to talk about is xxxxxx"

We all make mistakes. Most of us don't make illegal ones, and most of us don't air them out in public for all to see.

 

[beaucoup]

But I am curious what the lawyer told them to do about the son's bankruptcy and mom's money. It is all connected.

 

[kathie859]

That breeze you felt was the point of my post passing you by.

Of course, posting about cheating is going to get you criticism. My post was aimed in a different direction.

And that direction would be...???

 

[sookie]

After a 126 posts? Where is that dead horse icon when ya need one!

hahahaha! i love that smilie!! we really need to have that one uploaded. that being said, i love this board - you guys crack me up.

 

[sookie]

But I am curious what the lawyer told them to do about the son's bankruptcy and mom's money. It is all connected.

i know, its killing me!! i want to know! lol

there were so many different opinions in the thread - now i want to know who is RIGHT!