The 5 Year Look Back Period

I have discussed the fact that nursing home costs are very high and can deplete a person's resources.  Further, assets can not be transferred in order to qualify for medicaid which covers the cost of medicaid. 

The look back period applies to gifts made.  It also applies to assets placed in a Trust.  This would include trusts which have been set up for those with special needs if the trust was only addressing protecting public benefits of the special needs child. 

There are trust that serve as a protected Trust for Medicaid purposes.  If it were determined that a parent of a special needs child would have to be in a nursing home then monies can be placed in a Trust which is for the "sole benefit" of a disabled child. The Trust would name special needs child's estate, not other individuals, as remainder beneficiary in order to meet the "sole benefit" requirement.

Contact us at http://www.ythlaw.com/ for your estate planning and probate and elder law needs.

Asset Preservation

As our society ages, there are many issues that must be addressed.  In the area of preserving and protecting assets, we have to address the significant expense of nursing home care.  Can assets be protected from the cost of nursing home care?

There is now a 5 year look back period that pertains to transferring assets to other family members.  The look back period would apply to gifts. When applying for medicaid to cover nursing home costs, the question one has to respond to is whether any gifts have been made in the last 5 years. If so, it would extend the period of ineligibility for medicaid. The person would be treated as though they still have the money and therefore not qualify for medicaid for a period of time.

Let us help you plan for your future now and not wait until the need is upon you.  Contact us at http://www.ythlaw.com/

Irrevocable Trust - When to Use

The Irrevocable Trust is an asset protection vehicle because it can protect your assets from creditors, bankrupty, divorce and nursing home costs. However, there is a 5 year look back period when applying for medicaid to cover nursing home costs.

Further, you must be cautious when placing anything in an Irrevocable Trust. If others can not reach the assets in the trust, neither can you. You can not change the terms of the trust or terminate the trust in order to retrieve the assets placed into the trust. You have to treat the trust assets as though you no longer own them because you no longer own them.

Consult with an estate planning attorney if you think that the Irrevocable Trust serves your interest. Leave your comments here or contact us at http://www.ythlaw.com/

The Five Year Look Back - Keeping Assets in the Family

I am often asked about the 5 year look back period as it relates to nursing home costs. Will the nursing home take all of a person's assets? Can assets be transferred before a person has to go to a nursing home?

In order to qualify for state funding of one's nursing home expense, you either have to have no assets or spend down your assets. There are some permissible spend down, ie. prepaid funeral, home repair but the biggest one is paying for nursing home cost. Once you have paid for the nursing home care for a period of time, most assets are depleted. Some assets are protected if you are married and your spouse is not in a nursing home. If you are single, there is little that can be done unless you have planned ahead of time and transferred assets at least 5 years prior to going into a nursing home.

That is why planning now is so important. Leave your comments or contact us at http://www.ythlaw.com/