Attorney Thomas B. Burton answers the following question: "Can a Nursing Home Take Money From a Revocable Trust?"
Attorney Burton discusses how revocable trusts work and explains why in most instances a revocable trust is not going to be enough to protect your assets from the nursing home and other creditors. Instead, in Wisconsin, and most other states, you are going to want to consider using an irrevocable trust to protect your home, and other assets from the nursing home.
Want to learn more about asset protection for your home and how an irrevocable trust can help protect your home from the nursing home? Download a free copy of my 5 Step Guide on How to Protect Your Home from the Nursing Home.
Subscribe to Burton Law LLC’s channel to get notified when we post new videos.
Hello, I'm attorney Thomas Burton and today's question is the following:
“Can a nursing home take money from a revocable trust?”
Great question and I can see this question has to do with Medicaid planning, nursing homes and asset protection. So the short answer is a revocable trust or revocable living trust is not going to be enough if you're looking to do nursing home asset protection. The reason for this is the law changed in Wisconsin in 2014, the summer of 2014, August 1, 2014, the State of Wisconsin Department of Health Services announced they would begin to come after assets held in revocable living trust following the death of the person who died who would receive Medicaid assistance to pay for long-term nursing home care. Prior to that date, the State has said we are not looking at assets that passed outside the probate process and one of the great reasons to use a revocable living trust is to avoid probate.
Now, there were never a complete solution for Medicaid and nursing home care planning, but prior to that date, they could work very well in many situations because the state would not look at the assets after you died that float outside probate.
So for example, if you put your family farm in the revocable living trust and it passed that way after death, they would not come after the real estate, for payment after you are gone and died. So for today's current planning in Wisconsin revocable living trusts, are no longer effective for Medicaid and nursing home asset protection. If you have a trust prior to that date, discuss it with your attorney. There may be some limited benefits to keeping that trust, but I really recommend you look at an irrevocable trust to protect assets from the nursing home and from the Medicaid recovery program.
Now to do this type of planning, it needs to be done five years in advance of the date. You would need assistance from the state of Wisconsin through the Medicaid Program. So check out my other videos on Medicaid planning and how it needs to be done in advance. But in general, your question about, are assets protected in a revocable trust - the short answer in Wisconsin is, no, a revocable trust is not going to be enough, what you're going to want to discuss with your lawyer is an irrevocable asset protection trust and I recommend you only do this after consult with a qualified estate planning attorney who can walk you through the pros and cons of using this method of asset protection.
If you're interested in learning more about these types of trusts, I have a free guide on how to protect your home from the nursing home. It's available on my website and I'll put a link in this video.
So great question and thank you for asking.
© 2020 Burton Law LLC. All Rights Reserved. Transcript and captions provided for ease of access for the hearing impaired. For questions about this topic, or to suggest a topic for a future blog post, please contact the office.
Comments