People that you know who have looked into the subject may inform you about the benefits of revocable living trusts. Even if you are not extremely wealthy, you can benefit from the creation of this type of trust.
With a revocable living trust, you can name a trustee, and you can leave behind specific instructions that the trustee must follow regarding asset transfers. If you have concerns, you can instruct the trustee to distribute assets in a measured fashion over an extended period of time so that your beneficiaries do not burn through their inheritances too quickly.
This is one advantage, but there are others. For one, you could empower a disability trustee to administer the trust in the event of your incapacitation. This is a significant benefit, because many seniors do become unable to handle their own finances late in their lives due to incapacitation.
Plus, the assets would be transferred outside of the legal process of probate. This process would come into play if you use a last will as a vehicle of asset transfer, and it is time-consuming and potentially expensive.
A lot of seniors seek Medicaid eligibility eventually, because Medicare does not pay for long-term care. Medicaid is a need-based program, so you have to get assets out of your own name if you want to qualify. You could do this through the creation of a Medicaid trust.
However, a Medicaid trust and a revocable living trust are two different things. A Medicaid trust would be a trust that you cannot revoke. You could not take back the assets if you never need long-term care. Because you are surrendering incidents of ownership, the assets in the trust would not be counted against you by the Medicaid program.
Since you can in fact revoke a revocable living trust, these assets would be counted if you were to apply for Medicaid coverage to pay for living assistance.
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Our firm has prepared a series of special reports that cover numerous different estate planning and elder law topics. We have a report on revocable living trusts, and we also have a report on Medicaid planning.
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We can help if you would like to discuss your future with a licensed professional. Our firm offers free consultations, and we would be glad to answer any questions that you may have about living trusts and/or Medicaid planning.
To set up an appointment, send us a brief message through this page: Bucks County PA Estate Planning Attorneys.
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