POA--what can be done?

[Indiana Filer]

What is the name of your state? Indiana

My mother-in-law gave my sister-in-law Power of Attorney several years ago. SIL has not really had to do anything with the POA until recently. My MIL fell and is in the hospital. We're not sure if she's going to make it. In addition to the injuries from the fall, she's been showing signs of dementia for about the last year, with it getting worse in the past couple months.

MIL transferred the properties over to the three kids several years ago, but we just discovered that my MIL has an unusually large amount of money in her checking account which is only in MIL's name. We had a family meeting tonight, and the children have decided that they would like to take the money in the checking account and place it in three separate accounts, with each account being in the name of MIL and one of the children.

Most importantly, if MIL doesn't pass away, they want the money to be used for her care if she would need to go into a nursing home or for care to keep her in her home. There's enough for several months of very good nursing home care. There's no problem with the lookback period for medicare since they aren't trying to get medicare to pay for a nursing home. They're just trying to reduce how much would be in the estate if MIL does pass away so that inheritance taxes are reduced.

The question: Would it be legal for the POA to take the money out of the checking account to put it into these three separate accounts?

I realize that, if the accounts are created, any of the three could decide to take the money out and do whatever with it even before their mother's death. I believe that my husband's siblings would not do that to their mother. I know my husband wouldn't (because he knows I'd kill him if he did!)

[BlondiePB]

MIL transferred the properties over to the three kids several years ago, but we just discovered that my MIL has an unusually large amount of money in her checking account which is only in MIL's name. We had a family meeting tonight, and the children have decided that they would like to take the money in the checking account and place it in three separate accounts, with each account being in the name of MIL and one of the children.

Leave the account in MIL's name only. Does the amount exceed FDIC limits? Was SIL, the POA at the family meeting?

Most importantly, if MIL doesn't pass away, they want the money to be used for her care if she would need to go into a nursing home or for care to keep her in her home. There's enough for several months of very good nursing home care. There's no problem with the lookback period for medicare since they aren't trying to get medicare to pay for a nursing home. They're just trying to reduce how much would be in the estate if MIL does pass away so that inheritance taxes are reduced.

Don't you mean Medicaid? Medicare nursing home coverage is very limited & specific conditions must be met for Medicare to even pay for the limited, short coverage.

The question: Would it be legal for the POA to take the money out of the checking account to put it into these three separate accounts?

See above response.

I realize that, if the accounts are created, any of the three could decide to take the money out and do whatever with it even before their mother's death. I believe that my husband's siblings would not do that to their mother. I know my husband wouldn't (because he knows I'd kill him if he did!)

...Or perhaps copycat Lorena Bobbit.

[Sight Seer]

Check with the bank. With the POA it may be possible to establish a Transfer on Death with the account being devided between the three children. If this can be done it will avoid provate.

[BlondiePB]

Originally Posted by Sight Seer

Check with the bank. With the POA it may be possible to establish a Transfer on Death with the account being devided between the three children. If this can be done it will avoid provate.

How EXACTLY can an incompetent, legally, make such a change?

[garrula lingua]

Does the POA for SIL specifically include the ability to make gifts on her behalf ?

If so, the SIL has the legal power to do as you say.

However, some banks balk at honoring a POA, and some POAs are not well-written (are all pages initialed by MIL? the bank has a right to nit-pick).
Keeping MIL's name on each acct should alleviate the bank's concerns.

MIL may be really ticked when she recovers and finds out her kids distributed her wealth while she was ill ...

... some signs of dementia ? ... I think we all have them (I sure do)

[Zigner]

This makes me sick. The lady is still kicking! What a bunch of vultures <spit>

[garrula lingua]

PS: I forgot to point out - is the POA durable or springing POA ?

If springing, SIL will have to prove to the bank that MIL is actually disabled.


Yes, Zig, the vultures are all circling in the Wills section.