The Medicaid Asset Protection Trust (“MAPT”) is an irrevocable living ( inter vivos) trust which will help you qualify for Medicaid while preserving your assets for your heirs with these features:
- ASSETS: Grantors (also known as settlors or creators) place real property and brokerage accounts or other investments ( but not IRAs or 401-Ks), into the MAPT.
- TRUSTEES The trustee must be an individual other than the grantor to provide sufficient relinquishment of incidents of ownership. The home can be deeded trustees, such as your children.,
- INCOME. The trust usually provides for income to the grantor, but not access to principal to avoid the asset being deemed available for Medicaid eligibility purposes. Grantor trust provisions allow income taxes on trust assets to flow through, and be reported on, the grantor’s individual tax return.
- PRINCIPAL Principal distributions are only allowed to the grantor’s issue or other family members at the trustee’s discretion.
- Limited power of attorney. The grantor can change the beneficiaries.
- LOOKBACK PERIOD. Assets transferred to the MAPT are no longer considered countable resources for Medicaid eligibility purposes once the five-year lookback is cleared from date of funding. This can prevent the spend down and depletion of assets due to long-term care costs, leading to preservation of assets for beneficiaries five years after the deed is filed.
- PROBATE Assets in the MAPT avoid probate and Medicaid estate recovery
- SALE OF HOME. If you decide to sell your home, the trustees can purchase another home for you with the proceeds or invest the proceeds which does not affect the five-year look-back period.
- PROPERTY TAX EXEMPTION. Grantors are entitled to property tax exemptions if they reside in the home and they reapply for the exemption with the tax assessor.
Call or text the experienced New York Elder Law Attorneys at Friedman & Ranzenhofer, PC at (585) 484-7432 for a free consultation on preserving your assets.