What Assets Are Exempt From Medicaid in Florida?

The assets exempt from Medicaid in Florida include your primary home, one vehicle, household goods and personal effects, a limited amount of life insurance, designated burial funds, and retirement accounts that are paying out on a regular schedule. Florida’s long-term care Medicaid program caps countable assets at $2,000 for a single applicant, so the exemptions below are what let people with a house, a car, and normal belongings still qualify.¹ Everything else — bank balances, brokerage accounts, cash, a second property — counts toward that $2,000 ceiling.

Your Home

The homestead exemption is the single largest protection in the program. Florida disregards your primary residence regardless of market value, provided your equity in the home does not exceed $752,000 in 2026.¹ Equity above that figure turns the home into a countable resource and can defeat your application.

Three conditions attach to the exemption. The home must be in Florida. It must be your principal residence, and if you are already living in a nursing facility you need to show an intent to return. And the equity cap itself is waived — it does not apply at all — when your spouse, a child under 21, or a blind or disabled child of any age lives in the home.²

If your equity is too high, a reverse mortgage or home equity loan can bring it down under the cap.² Florida cannot force a sale of your home to pay for care during your lifetime.

Selling the Home Changes Everything

Sale proceeds are not exempt. You have three months to reinvest them in a replacement homestead (nine months if you are replacing a home lost to damage or disaster) before the cash becomes a countable asset. Miss that window and any remaining money counts against the $2,000 limit.

One Vehicle

You may keep one vehicle of any value, so long as it is used for transportation by you or a member of your household. A second vehicle counts at its fair market value minus any loan balance, so a paid-off spare car or an old truck sitting in the yard can quietly disqualify you.

Household Goods and Personal Effects

Furniture, appliances, electronics, cooking utensils, clothing, personal jewelry, prosthetic devices, and similar items you use in or around the home do not count.³ Wedding and engagement rings are specifically excluded. The line is drawn at investment items: a gem collection, rare coins, or collectibles held for their value rather than daily use are counted as resources.

Life Insurance

Whether life insurance counts depends on the combined face value of all your policies. If that total is $1,500 or less, the policies are fully excluded. If it exceeds $1,500, the cash surrender value of every policy counts toward the $2,000 limit. Term policies, which have no cash surrender value, do not count regardless of face value. A single modest whole life policy can put you over the limit when combined with the money in your checking account, so pull the numbers before you apply.

Burial Funds and Prepaid Funeral Contracts

Florida lets each person set aside up to $2,500 as a designated burial fund, separate from the $2,000 asset limit.⁴ The money must be held in a separate account clearly earmarked for burial expenses, and you designate it on Form CF-ES-2302, listing the institution and account number. Proof of separation goes to your eligibility specialist within ten days.

Irrevocable prepaid funeral contracts are treated differently and better. They are excluded entirely with no dollar cap, because the funds cannot be reached for any other purpose.⁵ Such contracts can cover professional service fees, a casket, cemetery plots, and related costs. Converting countable cash into an irrevocable burial contract is one of the standard planning moves for applicants who are over the asset limit. A revocable burial fund, by contrast, stays capped at $2,500.

Retirement Accounts in Payout Status

IRAs, 401(k)s, and similar accounts are not automatically exempt. Florida looks at whether the account is in payout status, meaning it is making regular periodic distributions of principal and interest calculated to draw the balance down over your life expectancy. When an account is in payout status, the balance is disregarded as an asset, though each distribution counts as income.

If you have the right to pull the full balance as a lump sum and simply choose not to, the state can treat the entire balance as a countable resource. Setting up actuarially sound distributions converts the account from a lump-sum asset into an income stream, which is the mechanism that makes the exemption work.

The Community Spouse Resource Allowance

If you are married and only one spouse needs long-term care, the spouse remaining at home is not held to the $2,000 limit. The Community Spouse Resource Allowance lets that spouse keep up to $162,660 of the couple’s combined countable assets in 2026, on top of the exempt home, one vehicle, and personal property.⁶

The figure is set by a snapshot of the couple’s combined countable assets on the date the applicant enters a nursing facility. If the couple holds more than the allowance, the excess must be spent down or restructured — often by paying off a mortgage or buying other exempt items — before the applicant qualifies. After approval, the community spouse can rebuild assets beyond the allowance without affecting the recipient’s ongoing eligibility.⁶

Two Limits on What “Exempt” Really Means

An asset being exempt for eligibility is not the same as an asset being safe. Two other rules can still reach it.

The Five-Year Look-Back on Transfers

Florida reviews every asset transfer either spouse made during the 60 months before the application date.² Gifts or sales below fair market value create a penalty period of ineligibility. The penalty is the total uncompensated value divided by $10,645, the average monthly cost of Florida nursing home care in 2026. Give away $106,450 and you face roughly a 10-month wait for coverage. There is no ceiling on the penalty, so large gifts can produce years of ineligibility.

Certain transfers are exempt from the penalty:

Transfers to a spouse.
Transfers to a child who is legally blind or permanently disabled.
Transfer of the home to an adult child who lived with you and provided care that delayed nursing home placement for at least two years.
Transfers into a special needs trust for a disabled person under age 65.
Sales at fair market value, which are not gifts at all.

The federal gift tax exclusion is a separate rule with its own numbers and has no bearing on Medicaid. A gift the IRS ignores can still trigger a Medicaid penalty.

Estate Recovery After Death

Florida can seek reimbursement from your estate after you die for benefits paid on your behalf after age 55.⁷ The claim runs against your probate estate, which can eventually include the home once no protected family member is living in it.

The state cannot enforce the claim if you are survived by a spouse, a child under 21, or a child who is blind or permanently disabled. Recovery must also be waived when it would cause an heir undue hardship — for example, when an heir has lived in the home for at least 12 months before death, owns no other residence, or provided full-time care that delayed nursing home entry.⁷ Losing an expected inheritance, on its own, is not hardship.

While you are alive, the state may place a lien on your home only if you are permanently institutionalized and no spouse, minor child, or disabled child lives there.⁸ Return home and the lien comes off. The exemption that lets you qualify is not the exemption that determines what happens to the property after you are gone, and confusing the two is one of the more expensive mistakes families make.

1
Cornell Law Institute. Florida Administrative Code 65A-1.712 – SSI-Related Medicaid Resource Eligibility Criteria
2
Office of the Law Revision Counsel. 42 USC 1396p – Liens, Adjustments and Recoveries, and Transfers of Assets
3
GovInfo. 20 CFR 416.1216 – Exclusion of Household Goods and Personal Effects
4
Florida Department of Children and Families. CF-ES-2302 – Designation of Resources as Burial Funds
5
Florida Department of Children and Families. Medicaid Eligibility Manual – Section 1630
6
Medicaid.gov. January 2026 SSI and Spousal Impoverishment Standards
7
The Florida Legislature. Florida Statutes 409.9101 – Recovery for Payments Made on Behalf of Medicaid-Eligible Persons
8
Medicaid.gov. Estate Recovery