Long term care is extremely expensive. Most people cannot afford this type of care without selling their home, which comes with its own set of problems. For example, if they have a husband or wife, where will their spouse live? A Medicaid Asset Protection Trust can be used to lower one’s assets so that they qualify for Medicaid, which pays for long term care at nursing homes and assisted living facilities. Our attorneys at Strategic Counsel Law Group, L.C. can help you fund a MAPT so that you do not have to spend off your life savings just to receive the care you need.
Why Might I Need Medicaid Asset Protection Trusts (MAPT)?
Medicaid for long term care is only available to individuals whose assets are less than $2,000. This is obviously a very small amount of money—far less than an elderly person would need to live off for the remainder of their life. Furthermore, if the individual is married and their spouse (who is not applying for Medicaid) is making more than $2,289 per month or has assets worth more than $137,400, the applicant is ineligible. As such, it is important to plan ahead by moving one’s assets into various Medicaid planning trusts, such as a Medicaid asset protection trust.
What is a Medicaid Asset Protection Trusts (MAPT)?
A Medicaid Asset Protection Trusts (MAPT) (also called Medicaid Planning Trusts, Medicaid Trusts, and Home Protection Trusts) are used to protect various types of assets (and reduce the individual’s net worth) while allowing the individual to qualify for Medicaid. In order for this to work. The MAPT must be created in advance to avoid Medicaid’s five-year look-back period, during which any assets transferred to another party or trust, which are not paid back in fair market value, make the applicant ineligible for Medicaid.
How to Fund a MAPT
It should be noted that once you fund a Medicaid asset protection trust, you cannot pull those assets out again, because MAPTs are a type of irrevocable trust. As such, you technically do not “own” those assets anymore, which is why a MAPT can be used to qualify for Medicaid in the first place.
- With Real Property—The most valuable asset of the typical American is their home. By funding a MAPT with your home, you vastly reduce your assets (and your spouse’s assets) and you are still allowed to live in the house or condo for the remainder of your life.
- With Investments—While you can fund an MPTA with investment assets, you cannot sell those investments in the future. You can, however, continue to collect income generated from those investments.
- With Profits From a Qualified Retirement Plans or IRA—You cannot directly fund a MAPT with a qualified retirement account or IRA, but you can sell the investments and use the profits to fund the MAPT.
Call an Experienced Medicaid Asset Protection Trust Attorney
Estate planning, particularly Medicaid planning, needs to be started long in advance of when you think you’ll need it. Call the Medicaid asset protection trust attorney here at Strategic Counsel Law Group, L.C., to schedule a free consultation. Call 813-286-1700 today.
