Pooled – Income Trusts

The Medicaid program provides critical financial assistance for those in need of long-term care, including assistance for people that want to remain in their home, rather than a nursing home. Despite remaining in his or her home, the costs related to that care are costly. While Medicaid would pay for the costs of an aide, utilizing tools, such as a pooled income trust, are necessary to shelter income for the applicant’s benefit. The knowledgeable attorneys at Futterman Lanza, LLP are ready to explain the benefits of a pooled-income trust and to help you establish this type of Trust

For over 25 years, Futterman Lanza, LLP of Smithtown, Long Island, has provided clients on Long Island with top-quality legal counsel in matters of elder law and estate planning. We understand how to address the complex legal questions that many individuals face during the Medicaid and estate planning process, and we work diligently to protect our clients’ rights with creative, compassionate and comprehensive solutions. Contact us today for a free initial consultation with an elder law and estate planning lawyer, and we’ll discuss whether a pooled-income trust might work with your Medicaid and estate planning strategy.

Along with our main office in Smithtown, we have locations in Melville, Bay Shore, and Garden City

Understanding Pooled-Income Trusts

The Parties:

Grantor – person that establishes the pooled income trust

Beneficiary – person that is entitled to use the funds in the pooled income trust (usually the same as Grantor)

Trustee – third party nonprofit organization that manages the funds (required by law).

When Would a Pooled Income Trust Be Needed?

When applying to Medicaid, the Department of Social Services, will review the applicant’s monthly income. Medicaid will allow an individual monthly allowance of $1,800 per month to be retained by the applicant from his or her income. Anything over this amount (overage or excess) is paid either to a Managed Long Term Care Agency or can be sheltered in a pooled income trust.

Utilizing the pooled income trust is the only way an individual on Community Medicaid could utilize his or her excess income while also receiving Medicaid.

Using the Pooled Income Trust

Once created, the beneficiary (person receiving Medicaid and funding the pooled income trust) will deposit their excess income to his or her account with the pooled income trust company. The beneficiary will submit bills to the pooled income trust which will then be paid by the Pooled Income Trust company. These bills can be used to pay for approved expenses, including, but not limited to the following:

Rent
Utilities
Credit card
Property taxes

What Happens if You Do Not Use All of the Funds Each Month?

Each month, any unused funds will roll over to the next month. However, upon the beneficiary’s death, it is a requirement that the pooled income trust donate the remaining funds to a charity of the pooled income trust company’s choosing. The agreement created must be followed through.

Example:

John’s receives income from social security and pension that total $4,000. After John pays for his health insurance (Medicare and supplemental insurance) his countable income is $3,500. Medicaid will allow him to keep $1,800 in his bank account. This means that he has an income overage or excess income in the amount of $1,700. John would contribute $1,700 to the pooled income trust company. John would then send his his electric bill, water bill, and credit card bill, totaling $1,500 to the pooled income trust. After the pooled income trust pays these expenses, $200 will roll over to the next month. This would allow John to use $1,900 in the following month.

How Can a Lawyer Help With a Pooled-Income Trust?

An experienced elder law attorney in Smithtown can help you establish an account with a pooled income trust company by:

Reviewing financial information and formulate a plan for Medicaid eligibility and sheltering income;
Explaining the benefits of pooled-income trusts such as spend-down strategies;
Advising on the different pooled-income trust companies and providing input on which company may be best;
Submitting the pooled-income trust application;
Establishing direct deposits of excess income;
Ensuring that Medicaid accepts the use of the pooled-income trust and adjusts your monthly income excess to reflect the use of the trust;

Contact Us Today for an Experienced Elder Law Attorney Serving Smithtown and Suffolk and Nassau Counties

We offer Flat-Fee billing for most of our client’s cases. We believe you should be focusing on your family’s future, not the clock. That’s why we operate on a transparent flat fee basis. Find out more about our flat fee billing during your free first time consultation.

Are you interested in learning about whether a pooled-income trust can help you preserve your income when in need of government assistance? If so, then contact Futterman Lanza, LLP in Smithtown today for a complimentary confidential consultation about your situation. An estate planning attorney with our firm will meet with you and help you make the right decisions for you.

Practice Areas

Pooled – Income Trusts

Understanding Pooled-Income Trusts

How Can a Lawyer Help With a Pooled-Income Trust?

Contact Us Today for an Experienced Elder Law Attorney Serving Smithtown and Suffolk and Nassau Counties

Smithtown Law Office
(Suffolk County)

Melville Law Office
(Suffolk/Nassau County)

Garden City Law Office
(Nassau County)