Wills, Trusts and Medicaid Asset Protection
Wills, Trusts and Medicaid Asset Protection

What to consider if you are a ‘snowbird’

Definition: What is a snowbird?

For the purposes of this article, a snowbird is a term often associated with people who move from New York and migrate southward in winter to the warmer locale of Florida. Snowbirds will typically have a home in both New York and Florida.

Snowbirds are typically those who have now retired.

For the purposes of this article, AE is Antony Eminowicz, Esq

Snowbird: “Okay, so I am snowbird! So what?”

AE: “Given that you own assets in both states some planning might well be necessary in order to ensure that these are protected to the maximum extent possible in the face of estate planning and long term care costs.”

Snowbird: “I live in Sarasota, Florida and have a house in New York. The house is ‘off the table’ for Medicaid purposes should I need skilled care Medicaid in Florida.”

AE: “This might well be true but not because of Florida’s bullet proof homestead protection laws. Florida does not have reciprocity with New York over the protection of an out of state home. Other planning methods are therefore required to fully protect the New York home, such as renting…”

Snowbird: “I live in Kingston, New York and have a house in Sarasota, Florida. If I rent out the home in Florida does that remove the Florida house from the table for purposes of New York Medicaid?”

AE: “No, not fully anyway. What is good for Florida Medicaid might not necessarily be the same for New York Medicaid. Because Medicaid is partially state funded, individual states have their own specific rules as to eligibility.”

Snowbird: “Fair enough… so I should plan if I have assets in both New York and Florida. I signed a New York power of attorney and health care directives giving my agent the widest possible powers to deal with my affairs.”

AE: “For purposes of planning that’s a good start.. but, as with Medicaid, both New York and Florida have their own rules governing the validity of such documents.”

Snowbird: “Oh but wait a minute………(?!) My son is at a New York law school and he tells me that provided my estate planning documents conform to local rules, it will be respected in the other state (such as Florida)”

AE: “Your son is correct. If your power of attorney and health care directives are correctly drawn up and executed in accordance with local rules then your New York power of attorney and health care directives will be respected in Florida, and vice versa. That being said… you really should have both a New York and Florida set of powers of attorney and advance health care directives. If appropriate, the documents can provide that the state in which the maker is found will dictate which set of documents shall be used. There is room for some confusion but the negatives have been far outweighed by the positives for my clients. Note that the term “Health Care Proxy” means different things in New York than it does in Florida and this in and of itself leads to confusion and practical problems with enforceability.

One other thing, both New York and Florida require specific provisions to be included in their powers of attorneys. So.. although Florida might honor a New York power of attorney, a Medicaid caseworker in Florida will not allow a particular type of Medicaid trust to be established, because of a lack of language in the New York power of attorney.”

Snowbird: “You specifically mentioned the power of attorney and health care directives. Not the Last Will and Testament??”

AE: “As with the POA and your healthcare directives, provided your Last Will and Testament conforms to local rules at the time of signing, either Florida or New York will honor the others Last Will & Testament…… “

Snowbird: “.. and I hear a ‘but’ coming……”

AE:  “..and you would be correct. Despite the ‘honor’ system that Florida and New York have in place, both states also have their own, shall we say, ‘quirks’ that could really prevent any smooth planning. Take the ‘Self Proving Affidavit’ as an example. This is an affidavit that is typically attached to a Last Will & Testament where the witnesses are saying that the Will belongs to the testator. Without such affidavit, the Will could be challenged. Unlike in Florida, New York does not require that the testator sign the self-proving affidavit. So.. even though the New York Will is perfectly valid in Florida, the self-proving affidavit portion of the Will would be defective, resulting in complications and potential challenges to the Last Will & Testament.”

Smart clients get smart lawyers who work together across state lines to develop sound estate and long-term care planning. 

Antony M. Eminowicz, Esq