Indiana Bar Association

Medicaid Intentionally Defective Trusts and Medicaid Qualified Income Trust (Miller Trust)

Indianapolis Attorney Experienced in Health Care Planning Matters

Comprehensive Medicaid planning involves not only a careful examination of an individual’s health care needs and finances but also an understanding of the eligibility requirements. Navigating through complex state and federal laws to determine whether you qualify for Medicaid can be an overwhelming task, and for many people, consulting with a qualified attorney is helpful. At Adler Law LLC, we can identify legal strategies that may be available in your particular situation to help you plan for Medicaid eligibility. Indianapolis Medicaid planning lawyer Michael J. Adler has been practicing in this area for over 20 years. He can explain the legal options that may allow you to qualify for Medicaid without losing your assets, including the creation of a Medicaid Intentionally Defective Trust or a Medicaid Qualified Income Trust, also known as a Miller Trust.

Creating a Medicaid Intentionally Defective Trust

Medicaid is a government program that covers the care of individuals who cannot afford nursing home care and other medical needs. In general, the applicant’s income and family size, age, resources and assets, and medical needs are used to establish whether he or she is eligible for Medicaid. While Medicaid laws require beneficiaries to have little income and few assets, not all of an applicant’s property is considered when determining eligibility. Accordingly, it may be feasible to re-structure the ownership of an individual’s property and assets to enable Medicaid eligibility.

In some cases, this may be accomplished by transferring assets into a special kind of irrevocable trust. A Medicaid Intentionally Defective Trust allows the grantor to retain an interest in the trust assets while benefiting from legal opportunities that facilitate Medicaid planning. Any asset transfers into a Medicaid Intentionally Defective Trust must be made by the grantor before the gifting ineligibility period, which is generally five years before the time that the grantor needs Medicaid coverage. Although the grantor will still pay income tax on the trust earnings, he or she will be able to take advantage of personal income tax deductions and retain certain rights over the trust property. In addition to reducing the grantor’s estate for the purposes of Medicaid eligibility, a Medicaid Intentionally Defective Trust can be used to avoid probate of the trust’s assets.

Devising a Medicaid Qualified Income Trust (Miller Trust)

A Medicaid Qualified Income Trust, also known as a Miller Trust, is an irrevocable trust created to hold a certain amount of income in order for an individual to meet Medicaid income eligibility requirements. Since Indiana recently became an income cap state for the purposes of Medicaid coverage, residents with income that exceeds the eligibility limit may qualify for Medicaid by directing the excess income into a Medicaid Qualified Income Trust. The trust will then distribute a small personal needs allowance to the Medicaid beneficiary and a minimum monthly maintenance needs allowance to the beneficiary’s spouse, with the remaining income used to contribute toward the beneficiary’s health care expenses.

Discuss Your Options With a Medicaid Planning Lawyer in Indianapolis

A knowledgeable attorney can help you determine whether you will benefit from establishing a Qualified Income Trust or a Medicaid Intentionally Defective Trust. With considerable experience and comprehensive legal knowledge, Indianapolis attorney Michael J. Adler can assist you in devising a plan to maintain Medicaid eligibility while preserving your assets. Mr. Adler serves people in Indianapolis, Westfield, Zionsville, Greenwood, Carmel, and Fishers, as well as other cities in Marion, Hamilton, Boone, Johnson, and Vigo Counties. Contact Adler Law LLC by phone at 317-635-7880 or online for a consultation with an elder law attorney.

Client Reviews

Hired Mike to help with our estate planning and to draft our will for our trust. My wife and I met with Mike and he knew we didn't know all the legal talk. He talked with us and went through each part of the procedure in normal terms we could understand. Mike is a very well educated person, family...

Mike B

Attorney Michael Adler prepared our trust for us when we had our first child. He is a very smart and compassionate family attorney who know his stuff. He was always available on the phone/email/in person and responds to queries promptly. Above all he is a great human being who genuinely cares for...

Andrea T

We had such an enjoyable experience with Adler Law. Michael Adler was very accommodating throughout the process. My husband and I had been procrastinating for years to plan our will and set up a trust/estate. He was professional, easy going and explained everything in layman's terms. He has since...

Andrea B

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