[WSBARP] Terminating Life Estate

Mon Jun 12 12:22:29 PDT 2023

Also, note that the value of the life estate is NOT based on a market value when DSHS is reviewing the transfer for Medicaid qualification. They use a table that assigns (unrealistically) high values to the remaining life estate, even of very elderly individuals.

For example, for an 80 year old they have 43.659% ownership of the market value of the property, according to the table that DSHS uses to value life estates.

This applies to the amount of estate recovery as well. So the state can recover up to 44% of the property value if they place a lien on the property to recover any Medicaid dollars spent on the life estate owner, even though the life estate terminates upon death. This has been litigated.

Jane.

Jane G. Bitz
Of Counsel
Wolff, Hislop & Crockett, PLLC
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From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com> On Behalf Of Jeanne Dawes
Sent: Monday, June 12, 2023 10:26 AM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
Subject: Re: [WSBARP] Terminating Life Estate

Tim,

If Medicaid is in the picture anytime in the next 5 years, I believe DSHS considers termination of the life estate is a gift of the value of the life estate.  If Medicaid is not in the picture, ditto what Britt said.

Jeanne

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From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com> On Behalf Of Britt, Christopher
Sent: Monday, June 12, 2023 9:55 AM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
Subject: Re: [WSBARP] Terminating Life Estate

A quitclaim deed would do the trick :). You can add language to address specifically why the qcd is being given (e.g. the grantor herein is executing this deed for the express purpose of transferring all right, title and interest in the property including the life estate granted by instrument ____________ ...")

Christopher G. Britt, M.A., J.D.
Attorney at Law
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On Mon, Jun 12, 2023 at 9:53 AM Timothy Lehr <timothy at stileslaw.com<mailto:timothy at stileslaw.com>> wrote:
All,

Owner of life estate would like to voluntarily terminate the life estate as she no longer resides at the property in question and is moving to full-time nursing home. Would anyone have a template deed or conveyance document that terminates a life estate? This is my first time addressing this issue.

Thanks,

Timothy C. Lehr
Attorney & Partner

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