The catastrophic health scare only counts 60 months. That should be and likely is the least of his concerns.
Tax implications would be far and away a more real concern and if Scott is smart enough to have sought counsel this (and not the boogie man of health scare) would have been the focus of the advice.
Not true RE the health care, and that was what Scott himself said was the reason for the quick claim deed.
Tax implications are also a real concern with this plan, obviously, but those were not stated in the original post. Capitol gains taxes for the daughter someday, with no automatic step up in basis available for her to use to exempt them down the road are a problem, possibly, but having been involved in long term care planning and estate planning for many years I know that your boogeyman or scare is very very real. Unplanned for long term care expenses are the number 1 cause of impoverishment of seniors. To ignore this reality is folly.
Scott has already said he has had a conversation with an attorney. I would suspect that the attorney can read the law and understand that Medicare's look back period on real estate transfers is 60 months. That information is readily available on the Medicare website and other online sources. It also comes into play only if the person making the transfer needs institutional care outside of what his health insurance (for Scott, as he has stated, Medicare and the VA) inside of those 60 months from the date of real estate transfer. Again, this information is readily available through the official Medicare websites and others. There may be other components in play, and an attorney would have advised him as to whether any were pertinent to his situation.
I suspect, too, that Scott is smart enough to have sought legal counsel and advice from an attorney that specializes in tax issues to assist with any taxable implications from the transfer and/or from a CPA. There is a lifetime gift amount that parents are allowed to give to their children. That may include land, and the amount might cover the transfer. I suspect the attorney/CPA Scott talked to would have mentioned this. You mention capital gains. For one, there are exclusions to capital gains on any sale of a primary residence. It sounds as though the daughter lives on the farm. Depending upon specific details that an attorney and/or CPA would go over with Scott and his family, capital gains are likely not a concern at all. Gift taxes might be, but again, there is a lifetime exclusion that I'm certain any decent attorney and/or CPA would discuss with them in detail as they apply.
safariman, by your posts here you didn't do estate planning for 37 years. You sold insurance for 37 years. There is a substantial difference. To present what you did in any other light might not be entirely accurate. That is for you to determine, not me. Also, a cursory review of your history here also raises questions about what you did and how you did it. Again, that's not for me to determine but it is there.
For me, an insurance salesman is not involved in estate planning or long-term care planning. He or she is selling an insurance product in order to make a commission. That is it and that is all. Planning requires, at least for me, someone with a license and training in a specialty area of law, accounting, and/or finance and investments. Attorneys have to pass the bar exam and then specialize in an area through continuing education and other requirements. CPAs have to pass a professional exam and do the same through CEs. Financial professionals are federally licensed through a series of exams and other requirements. Insurance agents pass a very basic test and sell insurance to make the companies they represent and themselves money through the sale of products. They are minimally licensed, they are generally not insured or bonded (unlike attorneys, CPAs, or financial professionals), and are not "planners".
Like it or not, insurance agents are not the go to source for legal advice. Attorneys are. Insurance agents are not the go to source for advice on investments. Financial advisers and planners are. Insurance agents are not the go to source for advice on taxes. CPAs are. I'd not talk to an attorney, CPA, or financial planner about the proper insurance coverage for my truck, and I'd not talk to an insurance agent about real estate transfers, investments, or tax issues. I suspect that Scott has sought the advice of those necessary.
I apologize to ScottF for the sidetrack of his thread. Good luck, Scott, on your new adventures and I'll be wondering where the new roads take you.
