My wife and I own a summer cottage along with my niece --- We own half, and my niece owns the other half. In our wills, we are leaving our half of the cottage to my niece. My concern is that if my wife and/or I have to go into a nursing home, can we exclude the cottage from being involved with turning over our assets to the nursing home. We do not have any long-term insurance.
Generally you are expected to pay for your own long term care in a nursing home. This involves spending savings and selling off assets such as property. If there is a spouse they can retain the main residence, a car (up to a certain value) and money to live on. Other assets such as a vacation home would need to be sold to pay for care. Once all assets are depleted then Medicaid would step in to cover the cost of care. Your niece may have to sell her part of the cottage if she was not able to purchase it at market value, but again the best advice would be to talk with an expert in retirement planning.
Over the last few years the government has become more aggressive in obtaining reimbursement for care paid for under Medicaid from those who tried to shield assets. Be sure to involve your niece in the discussion so she can start planning also.
