When’s a gift not a gift but a crime?
While gifting is a strategy sometimes used in Medicaid spend down scenarios it is not allowed without express authority drafted within the power-of-attorney document.
Power-of-Attorney documents in Tennessee may incorporate the “ordinary” powers of Tenn. Code Ann. § 34-6-109 by reference but must specifically identify any additional or extraordinary powers identified in Tenn. Code Ann. § 34-6-108 such as:
(1) Make gifts, grants, or other transfers without consideration, except in fulfillment of charitable pledges made by the principal while competent;
(2)Exercise any powers of revocation, amendment, or appointment which the principal may have over the income or principal of any trust;
(3)Act on behalf of the principal in connection with any fiduciary position held by the principal, except to renounce or resign such position;
(4)Exercise any incidents of ownership on any life insurance policies owned by the principal on the life of the attorney in fact;
(5)Change beneficiary designations on any death benefits payable on account of the death of the principal from any life insurance policy, employee benefit plan or individual retirement account;
(6)Change, add or delete any right of survivorship designation on any property, real or personal, to which the principal hold title, alone or with others;
(7) Renounce or disclaim any property or interest in property or powers to which the principal may become entitled, whether by gift or testate or intestate succession;
(8)Exercise an y right, or refuse, release or abandon an y right to claim an elective share in an y estate or under any will or
(9)Make any decisions regarding medical treatments or health care, except as incidental to decisions regarding property and finances.
Ultimately Ms Shelton revoked the Power of Attorney but was not successful in getting her assets returned to her. A jury convicted Mr. Natho of misapplication of an elderly person’s fiduciary property and though he appealed the verdict it was recently affirmed at the Texas Court of Appeals level. Natho v State (Tex. Ct. App., 3rd Dist., No. 03-11-00498-CP, Feb. 6, 2014).