As we age, the need for long-term care services may arise, and the cost of such care can be overwhelming. In Wisconsin, Medicaid is a program that can help cover these expenses, but it has strict eligibility requirements. An important tool for Medicaid planning in Wisconsin is a properly structured irrevocable trust, which can exempt assets from Medicaid eligibility calculations. In this article, we’ll explore how an irrevocable trust, such as The Estate Planning Group’s Irrevocable Vault Trust, can be used to protect assets and qualify for Medicaid.
Firstly, let’s understand the basics of irrevocable trusts. Unlike a revocable trust, which can be changed or revoked by the grantor at any time, most provisions in an irrevocable trust cannot be altered once it’s established. This means that once you place assets into the trust, you no longer have control over them. Instead, a trustee will manage the assets according to the trust’s terms, and you will have strictly limited access and control.
The Estate Planning Group’s Irrevocable Vault Trust is a popular type of irrevocable trust used for Medicaid planning in Wisconsin. By transferring assets into the trust, those assets are no longer considered part of the applicant’s countable assets for Medicaid eligibility purposes. However, it’s important to note that the transfer must be made more than five years before the applicant applies for Medicaid for the protection to be complete. This is known as the “five-year lookback” period, and any transfers made within this period will be subject to divestment penalties.
Choosing the right trustee is an essential aspect of using an irrevocable trust for Medicaid planning in Wisconsin. The trustee will be responsible for managing the assets in the trust and making distributions according to the trust’s terms, including providing for the grantor’s needs while they’re still alive and distributing assets to beneficiaries after the grantor passes away. It’s crucial to select a trustee who is trustworthy, responsible, and experienced in managing trusts.
The Estate Planning Group’s Irrevocable Vault Trust allows the grantor to transfer assets into the trust while still maintaining some control over them, such as the right to receive income from the trust and the right to change specific trust provisions. With the help of an experienced Life & Legacy Planning attorney, you can create a trust that suits your specific situation and meets your long-term care planning needs.
Properly structured irrevocable trusts, such as The Estate Planning Group’s Irrevocable Vault Trust, can be an essential tool for Medicaid planning in Wisconsin. By transferring assets into the trust, those assets are exempt from Medicaid eligibility calculations, potentially helping applicants qualify for much-needed long-term care services while preserving some legacy for the grantor’s family. However, it’s crucial to understand the five-year lookback period, choose a trustworthy trustee, and select the right type of irrevocable trust for your specific situation.
In conclusion, an irrevocable trust can be a valuable legal tool for Medicaid planning in Wisconsin. With the help of an experienced Life & Legacy Planning attorney, you can create an Irrevocable Vault Trust that suits your needs and ensures your assets are protected. By taking the time to understand the basics of irrevocable trusts, choosing the right trustee, and following the five-year lookback period, you can plan for your long-term care needs and protect your legacy.