A provision that limits the transfer of assets before a person becomes eligible for government medical benefits may also affect trusts. When a person in Georgia looks into estate planning, keeping this in mind will help ensure the protection of the estate. Medicaid planning requires one to understand how the transfer of assets may affect one’s own medical care and the inheritance of beneficiaries.
Medicaid is a government program that assists individuals with medical needs. To qualify, one must meet income requirements and maximum asset levels. In the past, individuals have transferred all assets out of their own name in order to meet requirements and access the benefits. In order to prevent this tactic, Medicaid has imposed a penalty period of five years. If assets are transferred out of one’s name within the five years prior to receiving benefits, there is a period of time in which the person is ineligible for the benefits.
If a person establishes a trust in which they are the sole beneficiary, or if they are one of several beneficiaries, the Medicaid penalty may still apply. A revocable trust, which can be altered to send all assets back to the original owner, is especially vulnerable to the penalty. Another type of third party trust may not be affected in the same way.
Understanding estate law and Medicaid planning can be difficult. In Georgia, many individuals look for help with what can be a confusing process. Many people choose to select an experienced estate planning attorney for more help going through the process.
Source: nj.com, “How trusts fit in with Medicaid planning“, Karin Price Mueller, Dec. 26, 2017