As 2015 begins, many in New Jersey have taken the time to consider things they would like to accomplish in the coming year. For many, planning for their retirement and beyond is at the top of that list. In addition to traditional estate-planning needs, many individuals and families are interested in learning more about the proper Medicaid planning.
Planning for Medicaid involves a careful and comprehensive plan in which the ability to claim this valuable resource is maximized. In order for an individual to access Medicaid benefits, he or she must have monthly income no greater than $809, or $1,192 if there is another person living within the same household. In addition, the available resources must be less than $14,550 for one person or $21,550 for two people. These limits do not include a $1,500 burial account.
There are also limits in place for individuals seeking Medicaid coverage of nursing home care. If the individual or couple exceed these limits, they will be required to deplete their own resources until those thresholds are met. At that point, Medicaid coverage will kick in. For many, a Medicaid trust offers a solution. This tool is a specially designed trust in which a family can transfer assets.
Those assets will be held within the trust, and a carefully chosen trustee will have the power to administer the trust, including paying out income. As long as that income does not exceed the Medicare income levels, it is possible to qualify. Assets placed within such a trust must be left there, or Medicaid eligibility could be lost. In addition, these types of trusts usually have to “mature” for a period of five years before they are considered valid for Medicaid eligibility, meaning that New Jersey residents who would like to take advantage of this option will need to do so far in advance of actually needing Medicaid coverage.
Source: theyeshivaworld.com, “Protecting Your Home From Medicaid“, Dec. 23, 2014