[WSBAPT] Medicaid eligibility: LLC

[Jen Doehne]

Hello all,

I am in the process of establishing an LLC for my clients to house an inherited family cabin and other intangible assets form their mother's Estate.

Two questions:

1.       Is it possible to transfer the family cabin directly from the Estate into the LLC (once established)? Since these are two transactions that individually are a mere change in identity, both transactions would be exempt from excise tax. Are there other concerns that I should be aware of? Can I combine both transfers into one PR Deed?

2.       My clients are concerned that, should they need Medicaid at a later date, their membership interest in the LLC could affect their eligibility. I do not work with Medicaid much, attempted to figure this out but have failed thus far. I am concerned that my standard language for Bankruptcy or "Certain Legal Proceedings" (below) may not cover the use of Medicaid by a Member. Any thoughts or suggestions?



"Disposition in the Event of Bankruptcy or Certain Legal Proceedings.  In the event that any of the events listed below should occur to a Member, then regardless of when the other Members discover the same, such Member shall be deemed to have retired on the day prior to the event occurring.  The events triggering this subsection are as follows:



a)  Voluntary proceedings by, or involuntary proceedings against, any Member are commenced under any provisions of any federal or state law or relating to bankruptcy or insolvency, legal or equitable (unless dismissed within ten (10) days), or the interest of any Member in the Company is attached or garnished; or



b)  Any judgment is obtained and any legal or equitable proceeding against any Member and the sale of said Member's interest in the Company is contemplated or threatened under legal processes as the result of such judgment; or



c)  Any execution is issued against any Member or said Member's interest in the Company; or



d)  Any other form of legal proceeding or process is threatened or commenced, by which the interest of any Member in the Company may be sold, either voluntarily or involuntarily."

Thank you everyone! Best,
Jen
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