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My mother-in-law has two small annuities. She was told by a lawyer that she will not qualify for Medicaid because of them - can she put them into a trust? Can Annuities be put into a Miller Trust or a Qualified Income Trust?

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Irrevocable trust protects if 5 yrs. Cost us $4500. We no longer own who is in it our 4 kids are trustees. Look back is 5 years for Medicaid I think 3 for VA now. No probate. Some investments you pay taxes on to move them & IRA'S cannot be moved. Could you buy a new car to transport your mom w her $20000. I believe any money spent is to help your mom, bars, ramp etc.
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Old Bob 1936 has it right. Your mother in law can get Medicaid for her husband by being named the "community spouse". She will have use of the assets until she dies or they are all used up. If she dies and still has a lot of assets, the Govt can come after her estate for money, they call it estate recovery. But her spouse will have gotten the treatment/care he needed and that is what is important. If she goes to the DHS in your state, the staff there can explain all these requirements to her. Her assets can be placed in a Miller Trust, and the DHS has the forms to fill out. Be sure you or someone else goes with her because it's a lot of "government speak" and terms you and she will have never heard before and will need explained. But it will be worth it in the end. Be aware, this whole process can take months to get completed.
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All financial assets and income will be reviewed by Medicaid. They look back about 5 years. The only way I can think of is to sell the annuities, and wait five years to apply. Otherwise, apply now and see if they will offset it.
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First, get a good elder care attorney. It may cost several thousand, but it saves you that much in a few months time. I just went through the process with both my mother, then a year later, my stepdad. You are not allowed to keep any annuities for the person needing Medicaid. Prepaid funerals are safe also. They can't touch those. They can, however, take cash if you are saving it with intentions of a funeral.
Bottom line, if your Dad needs Medicaid, attorney helps you to turn assets over to your mother, but when she becomes in need for Medicaid, the process with an elder care attorney starts with her. I got a discount with the second parent, on attorney's fees. I could not have gotten through this without the attorney, and my parents would have lost in the long run.
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care4rita had good advice. This is my understanding, too.
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We were told by an attorney the same thing for my brother's 401K proceeds that we pulled out to pay for his long-term care. We set up a Living Trust and paid the attorney about $1000 for the trouble. Whenever I applied for Medicaid for my brother, however, they would not accept it and it disqualified him from Medicaid. In essence, the trust was useless. I was the trustee so no matters of handing over control. Fortunately, the funds lasted long enough to take care of his needs.
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It is my understanding that once you are receiving payments on annuities they are not assets. My mom has an annuity that pays her for life. There is no cash value. It only counts as income not an asset. She has another one that had a 15 year guarantee but 15 years have passed.
Check the fine print on your annuities. You are usually turning over your assets to the annuity. That is why they are so profitable for those who sell them. In my mom's case, however her principle was paid back to her several years ago.
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No. Assets are assets. The only way that would have worked is if all of her assets were put into a family members name at least five years prior to needing Medicaid. A real catch 22. You can put assets in her name and someone else's and 50% will not be touchable by the government.
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There is something I am considering here. Since the annuities are being drawn from yearly, they are in pay-out mode. Retirement IRAs and annuities are not countable when it comes to Medicaid if they are in pay-out mode. They are still assets, but won't be counted when figuring if someone qualifies as long as the bank balance does not exceed the max allowed during any month. She would have to be careful so a lump paid in a year doesn't put them over the maximum. I would talk to the Medicaid officer about this. I don't know if this just refers to retirement annuities or if it is any annuity. It's also hard to determine if the annuity that is in her name alone belongs only to her or is an asset of the marriage.
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Contact a qualified elder care attorney. As the folks above said, the rules vary from state to state and these are matters that really should be addressed by someone familiar with the legal rules
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Really, for a total of 20k trying to get a Trust could take a big chunk and it maybe too late.
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My husband and I had all our properties except the house in a trust, which worked well for us. We were the trustees, so when he passed, I was the trustee, and sold off all the properties with no probate or anything. The house had been in joint tenancy which passed automatically to me and I had no problems when I sold it. My kids (which include a lawyer, an accountant, a business owner, and a loan officer) are the successor trustees, lawyer son primary. If family members are trustworthy, that is the easiest. We had ours done by a law firm associated with my business, and they don't sell any financial products. That's the thing to watch for.
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Can transfer funds between spouses with no lookback.
Also research Medicaid compliant annuities. I used a firm headed by Dale K. (google it) and was beyond delighted with the service and very low fee.
Odds and ends...countable assets include more than one vehicle..if you have two or more cars/motorized RVs, motorcycles, and so on, you get to keep just one with no complications...Two or more mean their value is counted as though they were money...Lots of stuff to find out...I just mentioned a very few.

Grace + Peace,
Bob
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I think Medicaid might consider that a violation of their rules.
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I am trustee of my own trusts, with alternates named in case I am incapable of handling it. Whether you can be trustee depends on the type of trust. You need an estate-planning lawyer (not one that just does simple wills). Transferring funds will have an impact on Medicaid qualification if done within the 5-year look-back period (unless this has changed - used to be a 2-year look-back). I know people don't want legal fees, but in this instance a lawyer may be able to save you thousands down the line.
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Depending how it's written, sometimes the owner of the trust is the trustee. My husband and I are trustees of our trust until we can no longer manage our affairs, then if our doctors declare us incompetent we have a state-licensed fiduciary assigned to take over. It's important to do background checks if you go that route, some fiduciaries are great and some are not. As others have stated, you need a really good elder care attorney to advise you based on your personal situation.
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Annuities can be set up all different ways. Some I think you can draw from but not cash in. Find out first if they can be cashed in. 10k sounds like enough for funeral expenses which Medicaid allows. Mom can't be drawing much from her annuity. If you can cash in, prepay your parents funerals. I would not give anything away. Medicaid has a five year look back. Money in that time period has to go for house upkeep/rent and parents care and needs. Especially in the spend down period. I think the annuity with both names half is used for dads care. Your Mom's annuity is hers. Medicaid rep can answer these questions for you.
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Laws vary from state to state. You need to speak with a good elder care attorney.
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Mom would be the "community spouse" if/when dad applies for Medicaid...
She would be entitled to half of their countable assets (look up for your state on google to learn what that means - I speak as an experienced layman and former community spouse).

The only thing that "bothers" me about you post is your saying a "lawyer." What kind of lawyer? Who recommended him? (When my wife needed Medicaid we went to see FOUR so-called elder care lawyers...It was obvious to me that they did not know much about Medicaid, but only were pushing trusts.) We got lucky and found and used the chairman of the eldercare section of our state's "Board of Lawyers" I forget the correct name of the board....

It is encouraging that the value of the annuities is small.

My wife died recently after nearly ten years on Medicaid.. Our house has been in a trust with me as trustee all that time...Medicaid will come after the house when I die. Current law is such that they are not going to get it, a I understand it...I cannot explain further than that because I do not know.

Grace + Peace,
Bob
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I personally would never trust a trust for that kind of money. You're basically giving away your money to a so called "trustee" who you pay to hold onto that money trusting they'll do the right thing. Sadly, money is just too tempting especially these days and too many people are robbed by the very people they trust with their finances. What I would do is go ahead and cash in those annuities and just use that money for things I absolutely need. If your MIL really doesn't need that money, then help she should someone who needs help because there are plenty of people out there who legitimately need help in some way or another. God says to whom much is given, much is required. If she needs the money to spend on herself, fine but if she doesn't then she should use it to help others in need because there are so many people around these days who are struggling to even survive, get transportation, meet medical needs, etc. So many people are praying for money as we speak because they don't have enough to get by and so many of them out there are permanently disabled and need help. There's no guarantee charity will do the right thing either, many of them have been caught pocketing the money donated by unsuspecting donors trying to do a good thing and get rewarded for a tax write off only to find out their charities are crooked.

You're best off to handle your own funds because money is just too tempting and crooks are just too easy to find these days. You never know how close one may be, you never know that it may even be within your own household, so why would you want to have a trust? There's no guarantee they'll spend the money on you because once you turn it over to them, it's actually their money to do with what they want and are not obligated to cater to you with any of that money. I checked out trusts a while back and I was shocked at what I was told about them. Nope, not for me! I would never ever knowingly turn my money over into a trust knowing what I know now if I had your  kind of money because there are so many smarter things you can do with it besides just spending it on yourself when so many others out there are hurting
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They are both under $10,000 from separate sales of property. One has her name along with her husband (the person needing Medicaid) and the other just comes to her. She is taking out the max w/o penalty. They both end in approx. 10 years and she will be 85.
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Kathy - you say their "small". Like each about 20k small; or 200k small?
To me, the amount makes a big big factor as to just what to do & if it's worth doing certain things.

Also other ?'s:
is mom taking out the maximum without penalty withdrawal annually from each?
what type of annuities?
When do they end & what age will mom be then?
And is mom going to qualify medically to be "at need" for medicaid as your state runs Medicaid?
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