Skip to main content
Tag

Miller Trust

How Can I Spend Funds in A Qualified Income Trust?

By Asset Protection Planning, Medicaid PlanningNo Comments

There are very specific rules regarding how the funds in a Qualified Income Trust (QIT) may be spent. It is very important that the Trustee ensures that only allowable expenses are paid out of the QIT account because if funds in the QIT are spent improperly, it could jeopardize the recipient’s Medicaid eligibility.

Only the following expenses can be paid out of a QIT account:

  1. The Patient Responsibility due to the nursing home (as determined by the Department of Children and Families)
  2. Health insurance premiums
  3. The Community Spouse Allowance (as determined by the Department of Children and Families)
  4. Medical expenses not covered by insurance (i.e. medical durable supplies, additional home health care agency hours, therapies not covered by Medicaid)
  5. Uncovered portions of an assisted living bills

If you have specific questions regarding managing a Qualified Income Trust account or your duties as the Trustee of a Qualified Income Trust, the experienced elder law attorneys of Bach, Jacobs & Byrne, P.A. are here to assist you. Call us at (941)906-1231 to set up a consultation.

June 2, 2020
Love0

Does the Qualified Income Trust Need a Taxpayer Identification Number?

By Asset Protection Planning, Medicaid PlanningNo Comments

Some banks may request that you obtain a Taxpayer Identification Number for the Qualified Income Trust (QIT, also referred to as a Miller Trust).  However, In Part 21, Chapter 7, Section 13 of “Assigning Employer Identification Numbers (EINs),” the IRS specifically provides that “If the trust is a Miller type of trust, do not assign an EIN. Instead, inform the trustee that he/she must …Use the SSN of the beneficiary or trustee to report trust activities.” A Qualified Income Trust (QIT) is a “grantor trust”, which means that for tax reporting purposes, the trust’s finances are the same as the Settlor’s finances.  Therefore, the bank must use the Social Security Number of the Settlor (the Medicaid recipient) when setting up the QIT checking account.

If you have specific questions regarding establishing a Qualified Income Trust,  the experienced elder law attorneys of Bach, Jacobs & Byrne, P.A. are here to assist you. Call us at (941)906-1231 to set up a consultation.

June 1, 2020
Love0

How much of my income should be deposited into the Qualified Income Trust?

By Asset Protection Planning, Medicaid PlanningNo Comments

The Trustee must deposit the amount of the Medicaid recipient’s income that exceeds the income cap into Qualified Income Trust (QIT) each and every month.  In 2020, the gross monthly income cap is $2,349.00. So, for example, if the Medicaid recipient’s gross monthly income was $4,000.00, the Trustee would need to deposit a minimum of $1,651.00 into the QIT each month.  If the Medicaid recipient’s gross monthly income was $4,500.00, the Trustee would need to deposit a minimum of $2,151.00 into the QIT each month.  In order to account for any discrepancies or fluctuations that may arise in monthly income, we always advise our clients to deposit more than the minimum amount each month.

Properly managing and funding a QIT is very important for maintaining Medicaid Eligibility.  If you have specific questions regarding funding a Qualified Income Trust account or your duties as the Trustee of a Qualified Income Trust, the experienced elder law attorneys of Bach, Jacobs & Byrne, P.A. are here to assist you. Call us at (941)906-1231 to set up a consultation.

May 29, 2020
Love0

What Items Must Be Included in a Qualified Income Trust Agreement?

By Asset Protection Planning, Medicaid PlanningNo Comments

A Qualified Income Trust (QIT) agreement is a complex document that must meet specific requirements to be approved by the Florida Department of Children and Families. According to the applicable Florida regulations, a QIT agreement must:

  1. Be irrevocable,
  2. Require that all funds remaining in the QIT at the time of the death of the Medicaid beneficiary be paid to the State of Florida (up to the amount of Medicaid benefits paid on behalf of the Medicaid beneficiary),
  3. Consist of only the Medicaid applicant’s income, and
  4. Be signed and dated by the Medicaid applicant, the Medicaid applicant’s spouse, or someone who has the legal authority to act on the Medicaid applicant’s behalf.

If you think you may need to establish a Qualified Income Trust, the experienced elder law attorneys of Bach, Jacobs & Byrne, P.A. are here to assist you. Call us at (941)906-1231 to set up a consultation.

May 28, 2020
Love0

How do I Establish A Qualified Income Trust?

By Asset Protection Planning, Medicaid PlanningNo Comments

A Qualified Income Trust (QIT) agreement is a complex document that must meet specific requirements to be approved by the Florida Department of Children and Families. The Florida Supreme Court has ruled that the preparation and execution of QIT is the “practice of law” and as a result, you cannot hire someone other than a Florida attorney to assist you with the planning and preparation of a QIT.

If you think you may need to establish a Qualified Income Trust, the experienced elder law attorneys of Bach, Jacobs & Byrne, P.A. are here to assist you. Call us at (941)906-1231 to set up a consultation.

 

 

May 27, 2020
Love0

Opening the Qualified Income Trust Bank Account

By Asset Protection Planning, Elder Law, Medicaid PlanningNo Comments

Opening the Qualified Income Trust Bank Account

Once a Qualified Income Trust (QIT) has been prepared and signed, the Trustee must establish and maintain a separate bank account in the name of the QIT. The account can be established at any banking institution. Prior to going the bank to open the account, it is a good idea to call your bank and make an appointment. It helps to explain the situation before you arrive for the appointment, so that the bank representative will know what your purpose is and will be better equipped to help you.  When you call to make the appointment, explain that you, as Trustee of a Trust, will be setting up a checking account and making a deposit. Explain that it is not a trust account, but just a regular checking account that happens to be in the name of a trust.  Make sure that the bank can offer you a checking account that is non-interest bearing, and that you do not need to keep any minimum amount in the account at any given time.

The QIT account should be titled in the name of the Trust, for example, “Jane Doe Qualified Income Trust Dated __________, 2020” or “John Smith, Trustee of the Jane Doe Qualified Income Trust Dated ________, 2020.” A QIT is a “grantor trust”, which means that for tax reporting purposes, the trust’s finances are the same as the Settlor’s finances. Therefore, the bank should use the Social Security Number of the Settlor (the Medicaid recipient).

Make sure you bring the original Trust Agreement and your Driver’s License or other government issued photo identification with you to the bank to open the checking account. The bank can make a copy of the Trust, but you should not relinquish possession of the original Trust.

If you have specific questions regarding setting up a Qualified Income Trust account or your duties as the Trustee of a Qualified Income Trust, the experienced elder law attorneys of Bach, Jacobs & Byrne, P.A. are here to assist you. Call us at (941)906-1231 to set up a consultation.

May 26, 2020
Love0

What is a “Qualified Income Trust”?

By Asset Protection Planning, Government Benefits, Medicaid PlanningNo Comments

As of January 1, 2020, in Florida, in order to qualify for Medicaid benefits, the applicant’s gross income must be less than $2,349.00 per month. In general, if the Medicaid applicant’s monthly gross income exceeds this amount, the applicant will be denied Medicaid benefits. The only current exemption to this barrier is the establishment of a “Qualified Income Trust” (QIT). A QIT is an irrevocable trust that can be established to receive the Medicaid applicant’s excess income.  Once the trust is established, a checking account is opened in the name of the trust. Simply put, establishing a QIT allows the applicant’s income to be exempt from the “income cap” by flowing the applicant’s excess income through a special checking account each month.

The QIT is irrevocable and cannot be changed after it is signed. Only the applicant’s income can be deposited into the checking account and only certain payments may be made out of the account. After the Medicaid recipient dies, the balance of the QIT will be paid to the State of Florida up to the total amount of Medicaid payments made on the recipient’s behalf.

If you have specific questions regarding asset protection planning and Medicaid eligibility, the experienced elder law attorneys of Bach, Jacobs & Byrne, P.A. are here to assist you. Call us at (941)906-1231 to set up a consultation.

 

 

May 25, 2020
Love0