Kara Daley

About

Developing estate plans, handling finances, and long term care planning are our focus. We work to assist our clients in mapping out their futures with the appropriate legal, financial, and health safeguards. Clients or their children may visit us in times of crisis; in those circumstances we work to provide the best options to resolve the issues while preserving the dignity and independence of all parties.

This firm routinely provides services in the areas of: estate planning (wills and trusts), durable powers of attorney, advanced directives, guardian and conservatorships, Medicaid planning, income cap trusts, disability trusts, VA trusts, bankruptcy, and other matters. Please contact us for an appointment to discuss your concerns. We provide valuable legal services at a reasonable cost.

INCOME CAP TRUSTS

In Oregon, Medicaid eligibility is determined by two factors:

• How much income the individual earns; and
• The value of the assets that the individual AND his/her spouse own.

In order to go onto Medicaid, an individual may only retain $2,000¹ worth of nonexempt assets and may only earn $2,022.00². In an Income Cap Trust, the income of the individual (known as the “trustor”)is placed in a trust that is managed by a friend or family member (known as the “trustee”). The trustee uses the funds to pay for the individual’s care. These funds must be spent in accordance with Medicaid rules, and to assist the trustee with paying them correctly, a payout plan called a Schedule B is attached to the trust. Once the trust is created and approved the trustee is responsible for opening a special bank account in which the medicaid client’s income is placed. Each month, the trustee must payout the funds according to the Schedule B. When the medicaid client passes away, any excess funds remaining in the trust are used to reimburse the state for its costs.

This trust can be a beneficial means for an individual to become Medicaid eligible. However, before deciding on a such a trust, you should speak with an attorney to see what other options may be available.

1. Please note that many of the assets commonly owned may be exempt from this $2,000 limit. Some examples include: a home, car or burial plan depending on certain circumstances. Please talk to your elder law attorney for more details.
2. Please note, these figures are current through July 2009 only.