Covering long-term medical expenses can be overwhelming, especially when you don’t want to lose your life’s savings to pay for the care. Many people ask the question, “Can a nursing home take money from a Living Trust?” The answer depends on if you have an Irrevocable or Revocable Living Trust.
Continue reading for a detailed explanation below.
Question: Can a Nursing Home Take Money from a Living Trust?
Before answering the question, it’s important to note that elder law attorneys are familiar with state and federal laws and regulations to help you protect your assets. In addition, they can guide you through your available options.
Now, to answer the question, “Can a nursing home take money from a Living Trust?” If it’s a Revocable Living Trust, no, it won’t protect your assets from a nursing home since your savings are still under your control. However, if you have an Irrevocable Living Trust, then yes, it will protect your assets from a nursing home because you’re moving ownership from your custody to another person’s control, as long as it was created over five (5) years of the creation of the Irrevocable Trust and the assets are also titled in the name of the trust prior to five years to avoid the five year look-back rule.
It’s important to note that creating an Irrevocable Living Trust isn’t that simple; it’s very different from a Revocable Living Trust. Therefore, it’s crucial that you understand the differences between the Trusts before deciding how to proceed.
Differences Between Irrevocable and Revocable Living Trusts
Irrevocable or Revocable Living Trusts each serve their purpose. You should check with an attorney to determine which Trust is the right option for your circumstance.
Here’s what you should know about a Revocable Living Trust:
- Help your family members avoid probate court
- Remain in control over your assets
- Add and remove assets when you choose
- Make changes when needed
- Close the Trust without consulting anyone else
The primary intent of a Revocable Living Trust is that it allows you to name the beneficiary who will receive the Trust’s payouts after you pass.
Here’s what you should know about an Irrevocable Living Trust:
- Select 1 or more beneficiaries for the Trust
- Loose ownership rights over the assets that are part of the Trust
- Unable to make any changes
- Modify or close the Trust only with the permission of a Trust Protector
The primary purpose of an Irrevocable Living Trust is that it allows you to protect all assets within the Trust from being used to pay for any long-term medical costs.
Additional Questions About Long-Term Costs
Here are some additional questions you might have when paying for long-term medical costs.
Will Medicaid take my money to pay for my nursing home care costs?
No, Medicaid can’t take your money if you enter a nursing home and cannot pay the expenses. Under the Estate Recovery program, Medicaid can claim reimbursement for the amount paid during your lifetime from your Probate Assets after you have passed. Non-Probate Assets and assets of a surviving spouse aren’t part of the claim. However, if a home is left to the surviving spouse, Medicaid can make a residence claim for it once your spouse passes.
How Can I Protect My Assets from Healthcare Expenses?
Elder law attorneys are familiar with the laws and regulations that they can use to help you protect your money and assets. Contact an attorney to see what plans are available for your situation so you can pass your hard-earned assets onto your beneficiaries.
What Are My Long-Term Care Cost Options?
There are several options available. Discuss your situation with an elder law attorney to determine which choice is right for you.
- An Annuity
- Medicaid Assistance
- Veterans’ Administration “Aid and Attendance”
- Long-Term Care Insurance
How Can an Elder Law Attorney Help?
Auld Brothers Law Group is a team of qualified elder care lawyers who help the elderly and their families advocate for them and protect their assets. We handle legal issues that involve:
- Health care
- Long-term cost planning
- Guardianships
- Retirement plans
- Medicare/Medicaid issues
Even if you don’t anticipate needing long-term care, unexpected situations can arise. Having plans in place can ensure everyone follows your wishes.
Schedule Your Free Phone Consultation Today
If you’re unsure you need help from an attorney, still contact us. We’re here to help you understand your circumstances while explaining your available options so you can make the decision that’s best for you. Contact us today.