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Medicaid Asset Protection Trust Is Important Tool for New York Seniors

A Medicaid Asset Protection Trust (MAPT) is one of the best tools available for seniors who do not have long-term care insurance to protect their assets from the staggering cost of nursing home care. This weekend our New York elder law attorney, Bonnie Kraham Esq., had a story published in the Times Herald-Record where she explained the value of this trust for local residents. The article highlighted the specific ways that a MAPT can help local seniors save assets for their family and dispelled misconceptions that some have about creating the trust.

A MAPT is a legal entity that a resident creates with the help of a professional to protect assets from being consumed in order to pay for long-term caregiving costs in the future–usually nursing home care. To create the trust, a resident transfers assets (such as the family home) into the separate legal entity and names someone other than themselves or their spouse as trustee to manage the assets in the trust. The senior may then be able to keep those assets down the road while still qualifying for Medicaid assistance if needed to pay for nursing home care.

Contrary to some misperceptions, local seniors who create a New York Medicaid Asset Protection Trust do not forever “lock up” all of their assets or lose the power to alter what happens to their property. The lifestyle of the senior who creates the trust is usually unaffected, because they still receive pension checks and Social Security checks directly, and they retain the exclusive right to use their home just as before while keeping their home tax exemptions. These trusts are irrevocable, but New York law actually allows the trust to be revoked with written consent of all involved parties. In addition, the individual who creates the trust can amend it to change the beneficiaries at any time.

Medicaid has a five-year “look back” period which makes it important for all residents to contact a New York elder law attorney as soon as possible to discuss this option. So long as five years has passed since the creation of the trust, the assets within the trust will be completely protected. However, even if nursing home care is needed within five years of the trust’s creation, a senior gets credit for the time that has accumulated. Therefore, while an early start is beneficial, no senior should put off the creation of a MAPT because of fears of being too old.

See Our Related Blog Posts:

Elder Law Estate Planning Documents Explained by New York Elder Law Attorney

Do Not Let Long-Term Care Destroy Your Retirement Planning

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