medicaid asset protection trust

Therefore, an attorney should be used to set up a Medicaid Asset Protection Trust. In fact, it is even possible to sell the home and for the trust to buy another one. By using our website, you agree to our terms of use and privacy policy. This is very unusual. HOW MUCH IS A MEDICAID ASSET PROTECTION TRUST? However, Medicaid also has income limits, so it’s important that this income does not cause one to have income over the limit. The Medicaid Asset Protection Trust (MAPT) – Do’s and Don’ts by Ettinger Law Firm by Michael Ettinger, Attorney at Law The Medicaid Asset Protection Trust (MAPT) is a technique commonly used by elder law attorneys. Your son may get divorced and may lose half the value of the house in the process. Because a MAPT is irrevocable, you do have to part with the ownership of the assets you transfer. Please note that a “Medicaid Asset Protection Trust” can also go by the name of “Medicaid Planning Trust,” “Home Protection Trust,” or “Medicaid Trust.” Make sure that the trust you select is Medicaid-compliant. For example, if you want to preserve your family home for your child’s benefit, you may be tempted to simply transfer the home into your child’s name right away. No. This may include a pour-over will, powers of attorney, advance health care directive (living will), and HIPAA medical information releases, in addition to the MAPT. California Medicaid (Medi-Cal), on the other hand, has very lax rules in regards to transferring a home to a trust. When considering the cost, there are a lot of variables. This is done via the deceased’s estate. Medicaid Asset Protection Trusts Many people recognize the importance of implementing traditional estate planning techniques such as having a will or revocable trust, executing a durable power of attorney and preparing advance health care directives. Learn more about Medicaid estate recovery. Is an Attorney Needed to Set up a Medicaid Asset Protection Trust? If your child lives with you in a caretaking role, it may be possible to transfer the home based on the Child Caregiver Exception. Creating a Medicaid Asset Protection Trust. *rv:/.test(navigator.userAgent)) { They no longer are considered owned by the individual. This is because if the trustmaker were also the beneficiary, he or she would have access to the assets, and Medicaid would consider them available to pay for his or her care and supports. The cost of creating a Medicaid Asset Protection Trust varies significantly from a low of $2,000 to a high of $12,000. This is a period of 60-months in all states, with the exception of California, which only looks back 30-months. Medicaid Asset Protection Trusts (MAPT) Irrevocable Trusts – a Valuable Tool in Medicaid Planning An irrevocable trust sounds like obscure lawyerly jargon. Medicaid asset protection is a collection of various different strategies and tactics that help clients protect their assets and financial interests from becoming the primary source of funding for their long-term nursing home care. What Type of Assets can go in an Asset Protection Trust? Therefore, it violates the look back rule. In order for the trust to be Medicaid exempt, the principal beneficiary must be someone other than the trustmaker. Private Medicaid Planners often work with attorneys to keep costs low for their clients. Why Are Medicaid Asset Protection Trusts Important? What are Medicaid Asset Protection Trusts (MAPT)? To benefit from the protection a trust can offer, however, it must be the right type of trust. How Do Medicaid Asset Protection Trusts Work? In WI, trusts that are irrevocable can generally be altered or cancelled if all parties (trustmaker, trustee, and beneficiaries) are in agreement. But once the trust owns your assets, Medicaid cannot count it as an asset you own or that … When properly established, a MAPT will allow the capital gains tax exclusion to apply to the entire primary residence. Medicaid Family Protection Trust The Medicaid Family Protection Trust includes some of the same benefits as the Medicaid Asset Protection Trust but also offers some more significant asset protection. This type of trust can shield your assets from Medicaid, allowing you to preserve them to pass on to your family. This is because the nationwide average cost of nursing home care is over $7,750 / month, and a MAPT prevents one from having to pay out of pocket for nursing home expenses (and other long-term care costs). If the child sells the home while you are still alive, Medicaid will take the value of the life estate to impact future eligibility. Special Needs Planning, Medicaid Eligibility Plan and Applications, SeniorLaw.com is brought to you by the law firm of, Adult Guardianship & Legal Guardianship of Disabled Adults. The assets in a Medicaid asset protection trust not only allow one to meet Medicaid’s asset limit without “spending down” assets, but the assets are also protected for the beneficiaries listed by the trustee. Asset protection means divestment. Medicaid does examine your assets and any recent asset transfers to determine eligibility, though some assets are not counted for this purpose, such as assets in a MAPT. document.write('