There’s a lot that goes into estate planning, but one often overlooked aspect is the potential need for long-term care. If you end up in a nursing home or long-term care facility without proper planning, then the costs of your care can quickly eat away your estate, thereby leaving your loved ones with little to nothing when you’re gone. And it can leave you at risk of being unable to obtain the care that you need.
That’s why you must act now to protect your need for future care, your estate, and your loved ones.
Using the qualified income trust
One way to do that is to create a qualified income trust, which is sometimes referred to as a Miller trust. This estate planning vehicle allows you to place any income above the maximum allowed for Medicaid eligibility purposes into a trust, thereby protecting your ability to secure Medicaid benefits. This can greatly offset the costs of long-term care.
Limitations on the qualified income trust
There are some important restrictions to note when it comes to this kind of trust. For example, only your income can be placed into the trust. Your spouse’s income cannot, which means that you’ll want to talk to your spouse about what other estate planning options might be beneficial for that income. Also, a portion of your income that is placed into the trust will be paid out to the state to help offset the costs covered by Medicaid. There may be other restrictions that you’ll want to discuss with your attorney.
Is a qualified income trust right for you?
It depends on your circumstances and what you hope to get out of your estate plan. These trusts can be highly complicated, and you shouldn’t decide without having all of the information that you need. That’s why if you’re wondering how to prepare for the potential need for nursing or long-term care, then now may be the time to discuss your concerns with an attorney who is competent in this area of the law.