My father recently went into an assisted living home after being diagnosed with dementia. My mother is physically incapable of taking care of the family home by herself. My original thought was for my wife and I to move in with her and turn the basement into a full in-law suite. Unfortunately, it turns out that zoning laws in Westfield may prohibit this.
The home is currently in an irrevocable trust created 4 1/2 years ago with me as the sole trustee. My question is, can I sell the home for her and use the money to buy a new home that has an in-law suite already set up? Would we be subject to taxes on the sale of the home under these circumstances and would the new home automatically be in the same trust or would we have to do a new one? I could really only consider selling the home if we wouldn't get killed by a huge tax bill.
Estate planning for nursing home
I'm sorry about your dad's deteriorating health. However, there appears to be some sort of estate, and perhaps, Medicaid planning in effect. As your father ages and his dementia becomes worse, he may need a higher level of care. I would not be doing you any favors if I tried to guess what you should do with the house without even looking at the current trust and figuring out what plan, if any, is in place. On top of that, I am not an estate planning expert. You need to have an estate planning attorney look over the situation and give you some advice about the tax implications of the sale and how you want to deal with the five year look back period for medicaid. Sorry I can't offer more help. Good luck.