Legal Definitions - antitransfer Laws

Antitransfer laws, also known as transfer of assets rules, are laws that penalize individuals who dispose of their assets for less than fair market valuein order to become eligible for public benefits such as Medicaid or SSI. These laws are in place to prevent people from taking advantage of the system and to ensure that those who truly need the benefits receive them.

For example, if an individual transfers their assets to a family member for less than fair market value and then applies for Medicaid, they may be temporarily ineligible for certain medical benefits. Similarly, if an individual transfers assets for less than fair market value and then applies for SSI benefits, they may also become temporarily ineligible.

Antitransfer laws typically have a look-back period, which is a specific time frame during which the transfer must have occurred. If an individual can prove that the transfer was made for a purpose other than to qualify for benefits, they may still be eligible for those benefits.

Overall, antitransfer laws are designed to prevent people from taking advantage of the system and to ensure that those who truly need the benefits receive them.

John is a senior citizen who has been living in a nursing home for several years. He wants to apply for Medicaid to help cover the cost of his care, but he knows that he has too many assets to qualify. In an attempt to become eligible, John transfers ownership of his house to his son for a fraction of its fair market value. However, because of antitransfer laws, John may be temporarily ineligible for Medicaid benefits.

This example illustrates how antitransfer laws can prevent individuals from disposing of their assets for less than fair market value in order to become eligible for public benefits. By penalizing these types of transfers, antitransfer laws help ensure that those who truly need the benefits receive them.