[WSBAPT] Trusts to Protect Assets from Medicaid

[Krista MacLaren]

Hi Jim,

I was just at an NBI Elder Law CLE on this topic last Friday, and one of the very informed speakers said at some point, don’t use life estates.  Unfortunately I don’t know exactly what he was saying, because I had missed much of the day’s speakers and wasn’t following the discussion very well.  If folks on the list don’t have the answer, you could check with David Kazemba in Wenatchee, the speaker.


Krista J. MacLaren
Attorney at Law
Northgate Executive Center II
9725 3rd Ave NE, Suite 600
Seattle, WA 98115
(206)523-6116
kjm.inc at mac.com

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> On Nov 17, 2015, at 10:22 AM, Jim Doran <jim at DORANLEGAL.COM> wrote:
> 
> Hello Listmates:
> 
> I know this is a common question and I also know that there is tension in the law regarding how and even "if" this can be done.  I have a client that is asking the question in a pretty straightforward manner.  I think this issue goes to the lack of progress in our society concerning health care and dying.
> 
> H & W, both in their early 70s, want to put their significant assets, two pieces of real estate and probably a third very valuable one that they will receive as an inheritance from mother, into a trust to protect them from the Medicaid asset requirements for eligibility and from the spend-down and recoupment provisions of medicaid.  I would imagine the protection from creditors in general is also part of the concept.
> 
> The concept is to put the assets into an irrevocable trust that gives them a life estate in the property they choose to live in.  The trust would direct that the remainder at the death of the second trustor would go to the children in a typical scheme.  H & W would keep some assets, such as investment funds and some cash and regular monthly income, out of the trust to live on.  Those assets would not be protected.
> 
> One question for them is, who will be the Trustee?  This is an irrevocable trust so you better choose wisely.
> 
> For me, the question is whether this can be done at all and how it can be done.  I am aware of the five year look-back provisions so we want to do this asap.
> 
> I do have access to the desk books and other library sources.  If someone can point me in the right direction, give me the right name for this kind of trust, or send me a model, it would be appreciated.
> 
> Jim Doran
> 
> 
> James R. Doran
> Attorney at Law
> 100 E. Pine Street -  Suite 205
> Bellingham, WA 98225
> (360)393-9506
> jim at doranlegal.com <mailto:jim at doranlegal.com>
> www.doranlegal.com <http://www.doranlegal.com/>
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