IRREVOCABLE LIVING TRUST AND 30-DAY LOOKBACK PERIOD

Discussion in 'General Discussion' started by kwoollyh, Sep 20, 2008.

  1. kwoollyh

    kwoollyh Newbie

    My mom has Alzheimer's and lives in an Assisted Living Facility. My deceased father's 20+ years military qualifies her for Aid & Attendence. My understanding is that 80K in assets is the limit (excluding home, which she doesn't live in). Paying for assisted living results in a $3000 shortfall between her expenses and her income.

    I have most of her assets in an Irrevocable Living Trust, but I need to move more in there to get it below the 80K limit. The Cameron Group came to the ALF and gave a talk about A&A and claimed:

    1. Anything in an Irrevocable Trust is not considered an asset.
    2. There is a 30-day lookback period for any transferred funds.

    Are both of these points true?

    Thanks so much for your help!
     
  2. vetfriend

    vetfriend Newbie

    Assets in an irrevocable trust are not a countable asset, but if the trust distributes income to the claimant, you will have problems. There is nothing I have ever seen that says you need to wait 30 days. My understanding is that the list of assets on the application must be accurate on the date of the application. Currently, there is no look back period on gifts.
     
  3. LindaV

    LindaV Newbie

    This is really interesting to me because my Mom has an irrevocable trust that is going down fast. With that not counting as an asset then she is well below the asset requirement. But she does get a distribution from the trust each month. It isn't really "income" because the trust doesn't earn $1,000./month. In fact, it is actually shedding income during these tough economic times.

    There was the mention of trouble that "vetfriend" mentioned to "kwoollyh" when discussing income from the trust. What kind of trouble would we encounter?

    (Our situation is that my Mom is an 80 year old widow of a veteran. Mom has MS, double scoliosis and has had serious back surgery.) She has daily help in the home but it isn't skilled nursing care.

    I am so grateful for any information you can provide.
     
  4. Patty

    Patty Newbie

    If the trust is paying for any of her assisted living or other medical expenses, they are no longer unreimbursed, so she can't claim them. If the trust is providing her countable income - then she needs to count it as income. All of her income needs to go to medical expenses. You should talk to a CPA or tax attorney about this.
     
  5. bayareablues

    bayareablues Newbie

    Hi Vetfriend,
    What do you mean by "you will have problems"? How do I circumvent them? The trust is distributing assets to my mother which I will report as income. We're still over our head in terms of expenses.

    Want to head off the problems if possible before applying. Any suggestions?
    Thanks!
     
  6. gary

    gary Newbie

    Can anyone provide a verifiable source for the statement "there is no lookback period"? I'd like to do what it takes to have my dad qualify as having no assets, legally.
     
  7. Patty

    Patty Newbie

    Hi Gary,
    Currently the VA doesn't have a look back period - posts like this will probably get them thinking about one. Regulations do not typically tell you how to get around them - which is why Medicaid had to start building in look back periods...and expand them from 3 years to 5 years as more people set their parents up for Welfare so the tax payers can foot the bill and the children can have the money.
     

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