When Is the Best Time to Set up a Miller Trust?
A Miller Trust is a very specific instrument designed for a very limited purpose. In most cases, it is used to fund a person's stay in a nursing home, and is created for those whose income is too high to otherwise qualify. It is very important that you set up the trust correctly and follow the rules to the letter. Bryan estate planning attorneys will work with you to set up your Miller Trust.
What Are the Rules for a Miller Trust?
A Miller Trust is used only for income, and not for assets such as a home or stocks. You should use a different irrevocable trust for these items in order to reduce your overall assets. A Miller Trust is designed primarily for reducing one's income in order to qualify for Medicaid, which is based upon need. This is important for a person entering a nursing home, where monthly costs can otherwise be prohibitive.
You may fund the Miller Trust only with income, a pension, or Social Security, and the entire income from that source must be deposited. In other words, you cannot place only half of your Social Security retirement benefit in the trust; you must deposit the entire thing. The Miller Trust must also be irrevocable, which means you will not have access to assets placed in it during your lifetime.
When Should I Set up the Trust?
Your attorney can help you with the process of setting up the Miller Trust, but it is best if you establish the trust and open the account into which the income will be placed a minimum of one month before your Medicaid benefits will begin. If you do not prepare ahead of time in this way, you stand to lose thousands of dollars in nursing home costs because your income will be reflected as too high to qualify for Medicaid. The bottom line is that you should not wait to open the trust until after you submit your Medicaid application.