A New York Medicaid Attorney Explains the Benefits of a MAPT

If you’re 65 or older and need financial assistance because you’re no longer able to live independently, you may consider applying for Medicaid benefits to pay for the expensive costs of a nursing home or an assisted living facility. However, this government assistance program has strict financial conditions that could drain your savings and deplete all your assets. 

The New York elder law and Medicaid planning attorneys at Landskind & Ricaforte understand that seniors who’ve worked hard their entire lives to save and stay out of debt don’t want to lose their money and assets because they need long-term care. To help ensure that you don’t use up your life savings, our experienced elder law attorney explains the benefits of establishing a Medicaid Asset Protection Trust (MAPT) and how to use your home to fund it. Schedule a free initial consultation to discuss your situation. 

How a MAPT Protects Your Assets

A MAPT, also known as an irrevocable income-only trust or Medicaid trust, can help protect your assets when you need to apply for Medicaid. This estate planning tool is used to shelter your assets so you can meet the agency’s strict eligibility requirements and help ensure your hard-earned savings won’t be exhausted by paying for long-term care. 

Many older adults find it difficult to meet Medicaid’s financial eligibility criteria, which often requires that they “spend down” their assets to qualify for benefits. When you establish a MAPT, you transfer assets into it, so Medicaid won’t count them when it determines your financial eligibility for benefits. One asset you can use to fund a MAPT is your home.  

Using Your Home to Fund Your MAPT Holding a model home in hands as symbol of protection

There are different ways to establish a New York MAPT, including the following.

  • Transfer ownership of your home into the trust. This approach means the trust becomes the legal owner of your home, but you’re allowed to live in it for the rest of your life. When you die, the property transfers automatically to the trust and doesn’t have to go through probate.

    This strategy could be more desirable than transferring ownership directly to a loved one while you’re alive. For example, if you transferred the property to a relative and then soon after needed full-time care in an assisted living facility, Medicaid would likely deny benefits if the transfer occurred during the 60-month “look back” period. 
  • Sell your home to the trust. If you think you might take this approach to fund your trust, the MAPT should be written to allow the trustee the right to buy and sell assets. If your home is sold, the proceeds are placed into the trust—they don’t go to you. The trustee is allowed to use the money to buy another house for you to live in. With this method, you can fund your trust with a piece of property and “start the clock” to get past the look-back period.

What to Know Before Transferring Your Home Into a MAPT

First, have your home appraised and the value accurately assessed. This appraisal is critical for determining the amount to transfer into the trust so you’re spending down the correct amount to ensure you meet Medicaid’s strict criteria for eligibility. 

It’s also important that you obtain a skilled New York home appraiser who knows how to factor in your home’s size, location, condition, and other properties in the neighborhood. When you have a complete and accurate appraisal, you can best determine the value you want to transfer into your MAPT. 

Medicaid Estate Recovery: Protect Your Home

If you live in New York, your home transfer into a MAPT is typically protected from Medicaid Estate Recovery. With this process, Medicaid seeks reimbursement for expenses it pays during your long-term care stay in a nursing home or an assisted living facility. When you draft and structure your MAPT with an experienced Medicaid planning attorney from Landskind & Ricaforte Law Group, P.C., you help ensure that your home isn’t subjected to this process and can be passed on to your loved ones without conflict.
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