Even as we age, we never stop filling out paperwork. This is especially true for parents of children with disabilities seeking to set up a trust for their child. Decisions about this process may affect the parent's own eligibility for Medicaid. To qualify for Medicaid benefits for a nursing home, an unmarried individual is only permitted to retain $2,000 or $4,000 depending on the Medicaid program. Transferring assets at less than what is considered fair market value comes with a penalty enacted by Congress, which results in the person who transferred those benefits being denied Medicaid for a period of time. This is something for older parents to bear in mind to protect themselves for when they may need those services.
Parents who have special needs children often have concerns about how they will be taken care of after they are gone, and who will be around to ensure their welfare or make decisions for them if they are unable to care for themselves. Creating a will, a special needs trust and setting up a guardianship are all fundamental estate planning approaches to easing concerns about this situation.
The basic idea behind asset protection planning is the preservation of your life's savings, to ensure that the wealth you have accumulated will be available to pass on to those to whom you wish to leave it.