@George4Tacks  confuses the issue with the reference to "inheritance tax."  Only states have inheritance tax, and most of them don't.  The federal government has an estate tax, the current exemption for which is $12 million, but that can always change.  Reduction is always possible.  IRS doesn't give a rodent's posterior about whether a gift tax return is filed, it just causes more work and no revenue for the American people, but it doesn't take long to fill one out if voluntary compliance with idiot rules is a thing for your client.  

Whether she owns the house or gives the money away so the only heir can buy one, doesn't make much difference in Medicaid planning ("Mom goes to the county home at taxpayer expense, while the kid goes on a cruise").  How much money does she have left, once she depletes her bank account by $200K?  My experience has been that those who can't afford to give money away, do it anyway, and those who can afford to be generous, aren't.