My Mother had a stroke 4 yrs ago and I became her POA. Now she is entering a nursing home on Medicaid and can no longer pay her Credit card debt. How should I handle this? Should I write them a letter? Declare bankruptcy for her? She ran up bills on credit cards by phone and internet. I fought with her but to no avail. What course should I take? I signed every paper by signing her name and then I put signed by , my name, POA. Do I have to pay her finances? I have been told no but I want to be sure as to how I should handle this.
@sharynmarie - NO ONE is saying *you* have to pay your mother's debts from *your own* assets. As PoA, you must pay them from *her* assets. And the law doesn't say that people can do whatever they like with their money, it says that they must pay their debts. If a person with a long history of frugality is suddenly being careless with their money, that is a *sign* of incompetence and it's time to take that person for an assessment.
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Now, that was just MY advise that I paid for. Free to you, and you know sometimes what free is worth, so again I'm asking, can you go see an attorney. Hint: NOT a bankruptcy attorney because they WANT to file bankruptcy. It's their business, after all.
As igloo suggested, a PO Box or mail company box would be in order to keep her dress separate from your own.
You can send the following type of letter (this is along the lines of what CarolLynn suggested & she is spot on with suggesting Clark Howard):
"Dear Debt Collectors - This is in regards of Mrs. YYY concerning the above referenced account collection related to credit card #1234.
The only owner of the above account, Mrs.YYY, is advanced elderly. YYYs income is federally protected income (e.g. Social Security benefit) which is dedicated to her health care. As per Sections 407(a) and 1383(d)(1) prohibit creditors from reaching Social Security or SSI benefits by levies, garnishments, or any other legal process.
Any communication must be sent in writing to Mrs. YYY at the above address (this should be the new rented postal box address). This is your notification that should you or any of your associates or any affiliates attempt to contact YYY directly, a complaint will be filed with her state’s: Attorney General; Department of Banking and Consumer Finance; and Ombudsman for the Department of Health and Human Commission, Senior Care Division, on her behalf.
This letter is not meant in any way to be an acknowledgement that YYY owes this
money. This letter is being sent to you within 30 day of receipt of your debtor letter.Thank you for your attention to this matter.
Jane Smith Jones in her limited capacity as DPOA for Mrs. YYY. "
Send each debtor the letter & certified mail with the return receipt (the green postcard @ the USPO). Should run $ 7.00 or so. As others have said, the debt collectors sell & resell the debt. You need to decided how to deal with it….some folks just let it play out and do nothing. If mom has nothing and your name and address CANNOT be compromised (like it's nothing like yours; or your address is very different from mom; the creditors don't know who you are or how to reach you) then I'd probably ignore the debt. My late MIL was a bit of a financial terrorist and we got the collectors letters & phone calls as my DH name was the same as his dad's. It was only from Hurricane Katrina that almost all that stopped. Although there was 1 bottom feeder that tracked her down to the NH in TX they got shipped out to and it was like a year later that it resubmerged. Collectors are relentless…
About the 1099-C, if you get one, post a new ? on it. Good luck Sideways and let us know how it goes.
Ok, here's the line, not between.
See an attorney, NOT a bankruptcy attorney, but one who is experiencing financial matters, BEFORE you issue any letters.
By possibly putting the cart before the horse, YOU don't want to be responsible for triggering any 1099-C's, which might be counted as income and fully furnished said someone right to Medicaid.
If our society decides to tackle dementia comprehensively across all areas impacted by it, we might find it improves other aspects of our society. For example, by compelling ADA accommodations for physical disabilities, we now have curb cuts used by parents with baby strollers and pedestrians with grocery carts and skateboarders. By making things easier for one smaller group of the population, we've improved quality of life for others as. If our society gets better at dealing with dementia, we might find other things get better too. So connecting how to deal with financial problems to dementia related health care problems is a useful though imperfect development. This site - imho - does a tremendous service of providing different viewpoints on this. And for letting others know when they seem harsh - like what Margaret has been viewed as doing.
Dementia changes the personality of the individual - it effectively invents a new personality. Sometimes that personality is docile and more loving and trusting. Most of the time it is not - it is deceitful, paranoid, petty. Depending on the type of dementia, this can be a decades long decline. Being DPOA does not mean being a "helicopter" for your elder in checking and going through everything they do. What you can (or better yet) cannot do is limited….if ma wants to go and get order hundreds of dollars of from Coldwater Creek or thousands from Home Shopping Network, that is their choice and right to do until they are legally declared incompetent and a guardianship determined.
My mom has Lewy Body dementia was viewed by society as sharp as a tack in many ways till her early 90's, so it was easy enough to shrug off odd behavior as "senior moments" that in retrospect should have set off alarms. There are other factors in denial as well -- admitting she was declining would immediately have saddled us with pressing decisions. My mom managed her small world very well then would have a paranoia episode, it was when the paranoia was constant (they were stealing from her every day sort of stuff), that I started her to get the medical file to show the need for LTC @ a NH. For my MIL, who was most difficult, it was a fall that made decision making happen and she went into a NH but before that she fought any oversight into the clusterF* that her finances were.
I was just at my mom's home dealing with repairs (thank you Polar Vortex!) and went through yet another box of paperwork & notes from my mom from a few years ago that I saw just how much of the lost-cognition iceberg lay below a competent surface for my mom. For me, thinking of dementia as an iceberg is a good analogy. Something always seems to surface….and collide.
" YOU don't want to be responsible for triggering any 1099-C's, which might be counted as income and fully furnished said someone right to Medicaid."
(was supposed to say)
counted as income and REALLY MESS UP SOMEONE'S right to Medicaid
But the cc company 1099-C's can be from years ago and there is no simple way to off-set the phantom income on those charges. I initially thought a "so-what" on the 1099-C because why would an 80 year old on SS even need to file taxes & then though a "wtf" just how could they rack up so much CC stuff. It was someone who did volunteer income tax at the library who told me not to ignore it as income reported to the IRS can come up as income when the state is verifying that you meet the income / asset limits for state programs (like food stamps, Medicaid) if your state dovetails IRS income data. BTW my friend said they couldn't do the IRS forms for it either, apparently none of the AARP or other senior tax volunteers programs can do them (only the simple forms get done), it has to be a CPA or other tax pro who can do them. There is an impoverishment form: IRS Form 982 - Insolvency Exclusion that has to accompany their taxes. It is totally loco to figure out the form too (well it was for me and I am pretty OCD on stuff) so I got a tax pro to do it and it ran about $ 300.
Where are you getting your information? Yes, all POA's are not written exactly alike. You should get your information correct before telling people on here what YOUR LAW is because it may not be the real deal. Be somewhat correct not just assume!!!
SECOND issue: my niece convinced my father to co-sign for a loan for her to get a car. This loan was taken out using my father’s name only, and of course the niece. The niece stopped making payments on the car, it was repossessed and was auctioned off for a lesser value. The credit union where the loan was taken out was threatening a lawsuit to collect the monies from my father. When my father passed away I personally went to the credit union and showed them the death certificate for my father and his name was removed from further collection.
I hope this clarifies things for you. I dislike being thought of as attempting to mislead someone.
When he passed away last year, he had no assets.
About debt going away: I took guardianship of my older terminally ill sister 17 years ago after her husband criminally neglected then abandoned her (but did not divorce her as he told my mother he would*). She too ended up in a nursing home and had already been on Medicaid for several years (end-stage renal disease automatically goes under Medicaid, at least it did then). She had a $10K balance on her credit card (not a joint account) when she went into the nursing home. I was POA and executor of her estate, which was only her $25K life insurance policy when she died. I called Citi Bank and TRIED to PAY THEM $10K dollars so her husband, who didn't spend 12 hours with her in the last year of her life, wouldn't get the money (the insuance was the reason he didn't actually divorce her). I begged the bank to take the money, but CITI Bank told me the debt had already been written off and they refused to take payment. After I paid for her funeral and any other tidbit I could possibly find, I still had to write her "husband" a check for $13K, which I would much rather have written to the bank.