MERP and lady bird deed

Hi Guest,

As far as I know, in Texas, as per the MERP regulations, the state will not be able to make Medicaid Estate Recovery Program (MERP) claim if there is a surviving spouse, a surviving child under age 21, an unmarried adult child who has resided continuously in the beneficiary's homestead for at least one year prior to the time of the beneficiary's death or a surviving child of any age who is disabled as defined by the Social Security Act or a child who is blind. As this is a law, then the estate recovery authorities will have to follow it. I would suggest you to contact an attorney and take his opinion in this regard.

Thanks

Thank you for the reply but we do not meet the listed exemptions thus the reason we placed her home in a lady bird deed. My inquiry is regarding the validity of the specialized deed. Is there precedence where this deedis honored by Texas merp?

You need to contact a Texas based attorney and take his opinion in this regard. He would help you in a better way.

Were you successful in keeping the house. I'm looking into doing the LBD as well for my mother's house but was wondering if it really keeps MERP from getting it when she dies.

Hi Markk,

If this is in relation to Medicaid penalty, then you can check out the given page to know more: http://www.mortgagefit.com/texas/ladybirddeed-medicaid.html .

Thanks

We used a Lady Bird and it worked, as the house has to go into probate before the "contract collectors for MERP" can collect. They will get very testy and you will receive some nasty letters and phone calls but just tell them that you wil NOT be opening probate as the matter has been taken care of legally. They will say that "there is a remainder interest" and just say "SO", I know there is a remainder interest; the Lady Bird is A REMAINDER INTEREST TRUST. dO NOT SEND THEM ANYTHING, DO NOT ENGAGE THEM IN ANY WAY, AND WHEN THEY CALL DO NOT ANSWER THE PHONE AFTER YOU TELL THEM THERE WILL NOT BE A PROBATE. These people are in the business of collecting and they act like it. If they can intimidate you into sending them information, they hope you will eventually fold up and open probate. Don`t do it.Until they change the law there is no way for them to do anything if you have a "remainder interest trust/Lady Bird" as the property changes over to you imediately and as someone stated previously they have a window in which they have to complete the case. The trust works and everyone should get one. The very wealthy people can transfer their estates up to several million dollars without any taxes being applied but if you are middle class or less then you are expected to pay what is a tax in the MERP program, while the wealthy get to keep their money . When I confronted an estate attorney while he was explainning about wealthy people being able to keep their money and pass it on I asked about MERP and he stated,"why shouldn`t they pay MERP". When I asked him why wealthy people were able to keep their money but we are made to pay he left the stage and disappeared.Wealthy people take advantage of all kinds of perks such as 14% tax if they are wealthy enough, and off shore accounts and business etc., unearned income get to keep their social security benefits without tax, but the rest of us are made to feel that we should pay all the taxes. Get the Lady Birds and hope the sorry lawmakers we have don`t change the rules. Good luck!

Thank you for sharing your opinion and experience in the forums!! :)