Are you "lucky"if you have a secure retirement?

[RedNeckGeek]

Things do happen. There was a case a few years ago where a Senator from Illinois was found to have quietly taken title to her mothers assets to qualify her mother for Medicaid.

These days it's a little harder to do something like that and still realize a financial advantage. Only a limited amount can be "gifted" tax free between parent and child each year (anything more is taxed, usually at the highest personal income rate), and Medicaid has lengthened the "look back" period over which it looks for assets that were once in the claimant's possession. Last time I checked that was five years, and it's probably longer now.

 

[houstonscott]

most trusts are formed to take assets out of the estate to save on estate taxes.

Estates are what are dissolved or liquidated to pay medical and long term costs. HS

 

[randy41]

Estates are what are dissolved or liquidated to pay medical and long term costs. HS

and how does forming a trust protect those assets from creditors?

 

[houstonscott]

and how does forming a trust protect those assets from creditors?

If you have ever faced long term care for someone diagnosed with Alzheimer's you would investigate. HS

 

[Scrambler82]

First a Trust, as far as I remember, is taxed at a higher rate because of the loss in overall revenue to state and federal.

AND you need an Irrevocable Trust that you give up the rights to the money but have someone, a trusting person, control the Trust and give you some of the money as it is earned.

A regular trust that you have control over is considered your money and in turn reachable by taxing parties.

To set up a Irrevocable Trust, get in touch with a trusted lawyer and talk it over with them and a Trust Attorney is better, they know all the in's and out's. Also, in MA, maybe other states, the Trust must be in existence for five year before it is considered "not part of your estate", so it is still reachable by the end of life gougers.

As I said, you need a good Attorney and someone you trust and do not put someone in charge of the trust that you do not have full trust in because by law they have control of the money and can take it all and do what they want with it.

I have talked it over with my daughter so we can set up an Irrevocable Trust and I will control the keyword and password, even though I have faith in my daughter there is always the husband, whose knows.

Luck with that...

 

[RedNeckGeek]

If you have ever faced long term care for someone diagnosed with Alzheimer's you would investigate. HS

Not sure how a trust would make any difference in the case of long term care costs exhausting financial resources. The trusts I'm familiar are set up so that the designated trustee would be the same person needing the LTC, and ownership of the assets only passes when that person dies. The arrangement avoids probate court and associated costs, but does nothing to impact Medicaid eligibility or estate taxes that I'm aware of. You'd be doing us all a huge favor, HS, if you could point us to information to the contrary, as this scenario is one we all dread.

 

[randy41]

If you have ever faced long term care for someone diagnosed with Alzheimer's you would investigate. HS

investigation was the reason for asking you.

 

[300UGUY]

If you have ever faced long term care for someone diagnosed with Alzheimer's you would investigate. HS

So you looted your relative's estate, so that the taxpayer's could pay for their care? I guess in your mind, that was well played!!!

 

[houstonscott]

So you looted your relative's estate, so that the taxpayer's could pay for their care? I guess in your mind, that was well played!!!

What ever gave you that idea? HS