Just thinking ahead.

This question has been closed for answers. Ask a New Question.
Revocable trust means changes can be made to the trust at any time.

How RT are looked at by Medicaid will be dependent on your states laws and how Medicaid is run for your state.
- Some require anything revocable to be changed to reflect the state or Medicaid as the primary beneficiary in order for them to be eligible for Medicaid. Trust escheats to state upon death.
- Others have it if the RT was done over 5 years ago, it’s not a recoverable asset.
- others require RT to be dissolved with property to revert to being in the elders name. So property will go the Estate Recovery/ MERP system after death and you will likely have to open probate and deal with your costs as claim against her he Estate as well as whatever claim state files. Unless you have exemptions or exclusions to MERP.

Its an elder law atty question to answer. Not a DIY ever imo.
But imho you MUST realize 2 things:
- states can change laws and administrative codes. Medicaid is a budget buster, so whatever states can do to produce revenue & reduce costs will likely happen in the future. It won’t be pretty.
- medicaid requires a copay or SOC (share of cost) of almost all their monthly income to go to the NH. All they get is a small PNA personal needs allowance that ranges from$35-$115 a mo. Most are $50.
There will be no-none-nada of the elders $ to pay a penny on anything on that old house anymore once on Medicaid.

If the elder wants to keep their homestead, Medicaid allows for it to be an exempt asset for their lifetime. But family is going to have to front all costs on the empty house that they do not own from day 1 of medicaid till beyond thier death and deal with MERP or escheatment of the state on the property. Whether or not this makes sense is up to you. Most posts on this site have the situation that family / heirs is all “gov mint not gonna take maws House” for a few weeks or months but fall off responsibility and paying for anything...... the dpoa or trustee has to pay for all and on a property that they may or may not ever benefit from at some unknown point in time. If this is likely to be your family, perhaps sell the property before ever applying for Medicaid so that the elder has more choices in places and if she dies before outspending her $ everybody benefits as per her will. Realize if you wait and sell it, like 8 months later, any $ you or others spent on house cannot be easily reimbursed to you all. It’s her house so it’s all her $ and anything to you will be viewed as gifting & not allowed by Medicaid.

If house is kept & trust beneficiary or heirs should have exemptions to MERP, they each will need to file and do whatever needed to get exemptions done for their share of property. And if rented, must be a FMV & that rental $ is reportable income to her & may be included in her copay to the NH. Plus rental property means special tax filings, insurance requirements, permits.....

Do property costs for last 3 years & meet with atty to see if continuing to keep property makes sense to do for 2 - 5 years. good luck
Helpful Answer (5)

This question has been closed for answers. Ask a New Question.
Ask a Question
Subscribe to
Our Newsletter