People like to say that home is where the heart is, but it is also where people establish most of their personal wealth. The equity accrued in a primary residence can potentially be the most significant contribution to someone’s net worth.
Naturally, people want to control what happens to their home and the equity they have built in it after they die. Many people want to leave their homes to family members or other loved ones. Even someone who believes their beneficiaries may not live in their home after they die may want their family members to receive the proceeds from its sale after their death.
Unfortunately, some people may have to worry about the state intervening and laying claim to their home after their death. When is a primary residence at risk following someone’s death in Maryland?
When they die without a will
Creating a will is necessary to maintain control over an estate. Individuals can establish very clear estate plans naming beneficiaries who should inherit their home or providing instructions about the sale of the property and the distribution of their resources.
If someone does not create an estate plan, then Maryland intestate succession laws determine what happens with their property. Typically, family members inherit from an estate when someone dies without a will. Parents, spouses and children could secure ownership of a residence after someone dies without a will in Maryland. However, if the state cannot identify any surviving family members, then the home and other resources in the estate could eventually become the property of the state itself.
When someone needs Medicaid benefits
Maryland provides Medicaid coverage for older adults with limited financial resources who require extensive medical support. The equity in someone’s home does not count against their eligibility for Medicaid benefits. However, the Medicaid estate recovery program can make a claim against someone’s remaining assets after they die.
The state can lay claim to an individual’s resources, including their home equity, to recover Medicaid benefits paid out on their behalf. The personal representative of a Maryland estate might need to sell a home or other assets to reimburse the Medicaid program for the benefits that someone received during their lifetime.
Barring those somewhat unusual scenarios, the state typically cannot assume ownership of someone’s real property or other assets following their death. Proper estate planning is therefore crucial for the protection of an individual’s assets. Those who create a thorough estate plan can expect to retain control over their legacy even after they die.
A Severn Estate Planning Attorney Can Help
If you want to protect your home and other assets, you need a comprehensive estate plan. Working with a Maryland estate planning attorney can help you draft the necessary documents to protect your property well into the future.
Call us today at 410-609-9987 to learn how our team can help or send us an email online.