Questions about inheritance and Medicaid in Washington (insurance, how much)

[rodentraiser]

Does anybody know anything about the inheritance tax in Washington state? My mother would like to leave me something in her will and she's concerned I'll have to pay taxes on any money I receive (doesn't everybody?). She's in the Midwest, I'm in Washington. I'm not sure what to tell her.

I am also on Medicaid at the present time. Because Medicaid has paid for coiling and stents for an aneurysm I had, I have been told they will come back and take whatever money they can get if I ever get any. My question here is, will they and how much? Will they take an inheritance, or Social Security, or both? If I get a back payment on disability if I'm approved, will they take that?

I'm not asking because I'm upset that they'll take it. I figure that's fair considering what my medical needs must have cost the state. I'm just trying to plan ahead and see where I might end up financially.

If anyone knows what the procedures are here, I'd be very grateful.

[CSD610]

It would be best to contact an attorney who has knowledge and experience with all the legal issues that are/may be involved.

[509]

Not only Medicaid....but IF your under an ObamaCare subsidy program the state can come back and collect back subsidies.

Inslee promised to change this...but then with all the millionaires claiming ObamaCare subsidies I believe he dropped the issue.

[Hemlock140]

If you end up with any inheritance, you should put it into a savings account and not touch it. I suspect that one state agency or another will lay claim in time, and you will have to come up with it. Inheritance tax only applies to huge amounts, not likely to affect yours, but the state, when they found out, will want it.

[jacqueg]

Originally Posted by rodentraiser

Does anybody know anything about the inheritance tax in Washington state? My mother would like to leave me something in her will and she's concerned I'll have to pay taxes on any money I receive (doesn't everybody?). She's in the Midwest, I'm in Washington. I'm not sure what to tell her.

I am also on Medicaid at the present time. Because Medicaid has paid for coiling and stents for an aneurysm I had, I have been told they will come back and take whatever money they can get if I ever get any. My question here is, will they and how much? Will they take an inheritance, or Social Security, or both? If I get a back payment on disability if I'm approved, will they take that?

I'm not asking because I'm upset that they'll take it. I figure that's fair considering what my medical needs must have cost the state. I'm just trying to plan ahead and see where I might end up financially.

If anyone knows what the procedures are here, I'd be very grateful.

There's such a thing as a Special Needs Trust - your mother might be able to leave the money to you via this kind of trust, and that might shield it from the state take-back provisions.

Your mother would have to check with an attorney to see whether that option is available in her state and whether you would qualify. It's a specialized thing, not all attorneys know about these. I know about them because when my mother did her will, my sisters and I heard about them, and we found an attorney who set one up for my disabled brother. I emphasize that this is not a DIY proposition, you need an attorney to set one up.

The attorney we found specialized in disability law, he was in a wheelchair himself.

https://en.wikipedia.org/wiki/Special_needs_trust

[Ruth4Truth]

No, everyone doesn't pay inheritance tax. It depends on how much she leaves you.

But Medicaid/Obamacare in Washington State will not take your money if it's held in trust, nor will having a trust disqualify you from future Medicaid, depending on how it's set up. You need to talk to a state employee who helps people navigate their way through the maze of insurance program/Obamacare options (someone impartial, who isn't tied directly to Medicaid) for advice.

[CrazyDonkey]

A back-payment from SS Disability will be safe. Any benefit payments from SS are safe.

You can have cash and other countable assets up to $2,000. You can have life insurance of up to $1,500 in face value, a burial plot, a prepaid funeral plan. I think your mother could give you her car, no matter its value, but any money you get from selling it would be a countable asset.

[rodentraiser]

Thank you, everyone, all this info does help a lot.


Whether my mom would want to spring for a lawyer to check out a trust, I have no idea. Although if Medicaid is going to just take the money, it might be better for me to opt out of the will and let my two brothers divide my share. I'm not trying to rip off the state, but one of my brothers has a daughter with a heart condition. She really wasn't supposed to live as long as she has and as she gets older, she'll need more and more care that my brother and SIL may not be able to afford. I'd rather the money went to them so they don't go into head over heels into debt trying to take care of her as well as their five other kids.

[Olympian2]

As the Washington Health Benefit Exchange tried - and continues to try - to enroll me into Medicaid simply because my AGI is negative (I am progressing on that problem), I had to learn about Medicaid in Washington (Apple Health). The last time that I checked, if your "resources" are beyond a couple thousand dollars, you'll no longer even be eligible for Medicaid. (I've posted URLs in the past, but they're no longer valid as Apple Health seems to be in flux.) So you should definitely consult a social worker and try to obtain legal counsel before accepting a gift or inheritance.

As for the state taking back money, that would be from your estate. The trusts mentioned may be a way around that issue, but I wouldn't know.

[rodentraiser]

Well, my resources right now are a little less than $200/month. That would make them about $2300 a year and I am still covered by Medicaid. So I'm not sure about that......but you and others are right, I should probably check with a social worker. The ones I've met aren't all that bright though, so I always wonder about the advice I'm given.