March 26, 2025 • 30 mins
Todd Whatley tackles the complex topic of irrevocable trusts in elder law practice, focusing primarily on Medicaid Asset Protection Trusts and when they're appropriate for clients. He draws on personal experience to provide practical guidance on implementing these powerful legal tools correctly.
• Irrevocable trusts require relinquishing control and ownership of assets, making them subject to Medicaid's five-year lookback period
• Many attorneys incorrectly structure these trusts by making the grantor a trustee or beneficiary, which can invalidate the protection in some states
• Medicaid Asset Protection Trusts are generally best for higher net-worth individuals with sufficient assets to cover needs during the lookback period
• Always implement a "cooling off" period before finalizing an irrevocable trust to ensure clients fully understand and commit to the arrangement
• Consider additional trust applications including charitable remainder trusts, Domestic Asset Protection Trusts, and irrevocable life insurance trusts
• Client communication and education are crucial – never recommend these tools without ensuring clients understand the loss of control and benefits
• Evaluate asset types carefully – retirement accounts typically make poor candidates for trust funding due to tax consequences
• Family farms and generational properties often justify irrevocable trust planning even with modest estates
For help implementing these strategies and for coaching opportunities, visit TheElderLawCoach.com or call to schedule a consultation.
Check out our new website www.TheElderLawCoach.com.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:19):
Thank you.
Specialized experience, Whetheryou're an established attorney
looking to refine your expertiseor an emerging lawyer seeking a
successful foray into elder law, this is your masterclass.
Now let's get started with theluminary in the field.
Here's Todd Whatley.
Speaker 2 (00:37):
That's right.
This is the Elder Law Coachpodcast.
My name is Todd Whatley and Iam, as always, very thankful
that you are here, and todaywe're going to cover a topic
that I have seen become verypopular over the last year or so
.
I've been using these for quitesome time and I see estate
planning attorneys, andparticularly some elder law
(00:58):
attorneys, learn about these andthey're like ah, this is the
cure-all for everything and itis not.
What I'm talking about is anirrevocable trust, particularly.
I'll spend most of my timetalking about the Medicaid Asset
Protection Trust, but I willalso mention a few other trusts
and just talk about when thoseshould be used and when they
(01:20):
should not.
Okay, so just in case you're notfamiliar I mean, you obviously
you're an attorney, you knowwhat an irrevocable trust is,
but let me just give somefoundational definitions just so
you can understand.
And irrevocable trust isbasically a legal arrangement
where the grantor transfersassets into the trust and
relinquishes control andownership, and that is crucial
(01:43):
when you're dealing with theMedicaid Asset Protection Trust
and, like I tell clients, thisis kind of set in stone.
Now, we as attorneys nevercreate an irrevocable trust that
can't be changed somehow.
I just tell them.
It is quite difficult to change.
So once we do it, it's prettymuch set Okay.
The purpose of an irrevocabletrust typically is asset
(02:05):
protection, tax planning,medicaid planning and some
estate planning.
There are many, manymisconceptions here.
So many attorneys and some ofthe public assume that an
irrevocable trust is very rigid,overly complicated, and they
can be, and they should be tosome point.
(02:26):
But there are some substantialbenefits to giving up control,
giving up the benefit from thattrust.
Okay, all right.
Some common scenarios where youwill see irrevocable trust okay
, where they are appropriate.
Okay, like I said, probably thenumber one way that I use
irrevocable trust is withMedicaid and long term care
(02:47):
planning.
Done correctly, this willprotect the assets while
qualifying for Medicaid.
It gets the assets away fromyour estate according to
Medicaid, so that they're gone,they're out there and Medicaid
cannot come after them.
They're out there and Medicaidcannot come after them.
Okay, now, since you arerelinquishing control of those
(03:13):
assets, then that is seen as agift and therefore you are
subject to the five-year lookback.
Okay, and you need to be awareof that.
That's where I see a lot ofattorneys messing up is someone
comes in with a house and$100,000, $200,000 in the bank
and investments and they're likeoh, we need to protect the
house, so we put the house intoan irrevocable trust.
Well, that's great if you canmake it five years.
(03:35):
But the problem is I'm prettyconservative on this and the
last thing I want is for myclient to do this and then have
a stroke next week and neednursing home care for the next
five years.
You don't have enough moneywith one or $200,000 in the bank
to cover five years worth ofnursing home care and, if done
(03:56):
correctly, you should not beable to give that house back to
the person.
One thing on this let me justkind of take a detour very
quickly is when you do this, youneed to be careful, because
some states and I live in onethat is very particular about
this they have made it clearthat if your state allows you to
(04:17):
reduce a penalty I'm prettysure all states allow you to
eliminate a penalty.
If you give back all of theassets, that will eliminate the
penalty.
But here's the key thing mystate, arkansas, is very
particular that the gift has tobe returned from the person or
the entity that it was gifted to, and the terms of an
(04:40):
irrevocable asset protectiontrust is that the grantor, the
Medicaid applicant, is not thebeneficiary of this trust, and
so therefore it is a violationof the terms of the trust for
the trustee to transfer the homefrom the trust back to the
applicant.
The trust says you can't dothat.
(05:00):
And I can see Medicaid sayingyou can't do that.
You can't give the house back.
You put it into an irrevocabletrust where the grantor was not
the beneficiary.
You're stuck with it, and insome states you might be able to
transfer it from the trust tothe lifetime beneficiary, one of
the kids, and the kid give thehouse back to the parent and
(05:21):
kind of argue with Medicaid thathey, you know, this is the
house that was gifted to thetrust and now it's back in their
name.
Well, I still think Medicaidcan say nope, this was given to
the trust and the trust did notgive it back.
So therefore we are notrecognizing the reduction or
elimination of the gift.
You see, that's where a lot ofpeople jump into these and they
(05:46):
do it quickly and they think, oh, this is the cure-all for
everything and it's not.
You have to be careful aboutthis Now.
Then there's the other issuesof who's the trustee, who's the
beneficiary.
I do a public speaking eventevery first Thursday at this one
place public speaking eventevery first Thursday at this one
(06:06):
place and the director of thisplace brought me a local
caregiver or caregiving inArkansas and it's a magazine
that you can buy ads in and ithas articles.
And one of the advertisers wasan elder law attorney in
Arkansas and he wrote an articlein the director of this
facility, he's a physician.
And he said the director ofthis facility, he's a physician.
(06:29):
And he said I want you to readthis article and tell me if you
agree with the determinations ofthis attorney.
And I kind of looked at him.
He said I'm just curious whatyou think.
I was like okay, and so I hadfinished my event and I needed
to get back to the office.
So he just gave me the magazineand so I got back to the office
and I read it and I was like,oh no, this is an Arkansas
attorney who I have been told bythe state that if you have a
(06:54):
trust where the applicant is thetrustee or the beneficiary in
any way, it is a countable asset.
I've been told that I don't riskit.
My irrevocable trust makes thegrantor and the future Medicaid
applicant, not the trustee andnot the beneficiary in any way
whatsoever.
This guy's doing trust, withthe grantor as the trustee and
(07:18):
they have income benefits fromthe trust.
And I've been told by DHS that,even though it really doesn't
follow federal law, that theyhave told me that they're going
to deem it to be a accountableresource and we can fight it out
in court, which is a two-yearfight while the nursing home
bill's building up and we don'tknow that we're going to win.
(07:39):
And so I am very conservativeon this.
I will fight and fight andfight on things that I know I'm
right and I know that I shouldwin, but on this topic I don't
know that and I don't want atwo-year fight over this issue
that I'm not absolutely sure on.
And it's an easy fix you justtell your client you're not the
(08:01):
trustee, you're not thebeneficiary and boom, it is
absolutely protected fromMedicaid once you do that, okay,
but this guy's doing this, andthat gets into the issue of
whatever goes into.
The trust can't come back tothe grantor and therefore you
can't reduce or eliminate thegift and you're stuck with this
(08:22):
gift regardless.
And so please be careful whenyou're doing these.
I reserve these for higher networth people.
In Arkansas, nursing homes areno more than $10,000 a month.
Easy number to calculate that's$600,000.
When you factor in income, thatreduces that maybe down to
(08:43):
$400,000, $ $500.
So generally I don't do anirrevocable trust Medicaid Asset
Protection Trust unless it isworth it.
There are enough assets for usto be able to put enough in
there for the trust to makesense and keep out about
$400,000.
(09:03):
Okay, and that does varydepending on income, but I feel
safe.
The client doesn't feel broke,they can go on vacation, they
can buy a new car, they can dowhat they want to with that
$400,000, knowing that everymonth they get through this
five-year penalty that's $10,000.
They, knowing that every monththey get through this five-year
penalty that's $10,000 theydon't have to pay and so
basically they can spend 10,000bucks a month within reason and
(09:27):
know that they've got enoughmoney to get them through the
remainder of the five-year.
Look back Okay.
So that's my spiel on theMedicaid Asset Protection Trust.
Now there are some otherirrevocable trusts and we use
those sometimes in estateplanning just pure estate
planning, not so much Medicaid.
And this tends to come intoplay with your high net worth
(09:49):
people a trust that you cantransfer assets into.
That are either seen as giftsor you can make it so that
you're within the annual giftingexemption and you don't have to
fill out gift tax returns andit doesn't reduce your lifetime
exemption.
And so there are some truststhere and, particularly when one
(10:09):
spouse passes away, you wantthe lifetime exemption or a
portion of it to go into anirrevocable trust so that it is
outside the estate of thesurviving spouse and you can
save a whole lot of taxes.
You basically double theexemption amount and you can put
some terms on that so that thesurviving spouse can benefit
(10:31):
from it, but it is outside oftheir estate.
Some states have what are knownas the Domestic Asset Protection
Trust.
Arkansas has just fairlyrecently, created that.
I have not done one yet.
I am researching it and I'mstarting to mention that to
clients as an option, and it issimply what it says.
(10:51):
It's you're able to put yourassets in there and it is
protected from creditors,bankruptcy, divorce, things like
that.
After two years you can't do it, knowing that there's a debt
and that protection does notkick in for two years, and so
that's really good for high riskprofessionals, physicians, some
attorneys, business owners,people like that.
(11:12):
This domestic asset protectiontrust, which is obviously
irrevocable, is a huge componentof some people's estate and the
benefit of protecting fromcreditors is huge in depth.
(11:40):
But a lot of times, particularlyafter the death of the parents
and they leave their estate intoa special needs trust, that
trust becomes irrevocable sothat the trustee can't change it
, can't mess things up, can'tpull the money from any so that
the money benefits anyone otherthan the disabled person.
I will leave those revocableduring the lifetime of the
parent, particularly becausethere's not much money in it.
(12:00):
We create it.
It's there, ready, willing andable to accept money.
But typically if the parentsare alive, they're just going to
do things for their disabledchild.
They don't need the trust.
But it's there and if someoneelse wants to leave money into
it, a lot of times I'll do thiscool little trick that I think
elder counsel taught me.
This is make the trustrevocable and if someone else
(12:24):
wants to leave money into thetrust, you can put language in
the trust that says if thistrust accepts over $25,000,
$50,000, whatever that number is, then even during the life of
the parents it becomesirrevocable.
That way the grandparents anduncles, somebody can say, hey, I
would love to leave money tothis disabled child, but I'm a
(12:45):
little nervous because it'srevocable.
And if I leave it in there andit's revocable, the parents can
cancel this trust, pull themoney out of the trust for their
benefit and not for the child.
And so, therefore, to fix thathesitation, we'll put language
in the trust for their benefitand not for the child.
And so, therefore, to fix thathesitation, we'll put language
in the trust that says thistrust becomes irrevocable once a
set amount of money goes in.
(13:06):
We don't want someone puttingin $5,000 and having to lock it
down.
It needs to be a substantialamount of money.
It's like, hey, if you're goingto be serious about this,
$25,000, $50,000, whatever,that's the number.
I have also recently started,just because I've just never had
clients that, to be honest, Ididn't fully understand these.
(13:26):
I knew what they were, but Idid not understand them, and so
therefore, I did not recommendthem since I did not understand
them.
Now, working with a financialadvisor very closely, we have
done a number of charitableremainder trust or charitable
lead trust, basically justcharitable giving and
irrevocable trust that you canput highly appreciated assets
(13:49):
into and therefore not have topay the capital gains benefit
from those assets during yourlifetime and then it ultimately
goes to a charity at the time ofyour death and those can save
people hundreds of thousands, ifnot millions of dollars, in
taxes and do what they want.
And particularly if a clientcomes to you and they mention I
(14:10):
really want to benefit somecharities, that's great.
Okay, let's benefit charities.
But benefiting charities atdeath is great, but you don't
get a tax benefit for that.
Why not?
Let's do it now.
Or let's still benefit thecharity at your death, but let's
get a tax benefit for thattoday and you still benefit from
that money today.
(14:32):
If that doesn't make sense toyou, I probably should do a full
podcast just on that topic,because once I learned about it,
it really opened up the doorsand allowed me to, within my
fiduciary duty to my client, sayhey, do this trust?
This is a trust, that taxdeduction charitably oriented,
you get the income off of it,you don't have to pay taxes on
(14:54):
this.
Now.
I mean, it's just a beautiful,beautiful tool and if you don't
fully understand it or you don'thave a financial advisor who
fully understands it, give us acall because we can definitely
walk you through that, okay.
And then finally, probably oneof the most popular irrevocable
trusts is the irrevocable lifeinsurance trust.
Those are beautiful tools also,particularly for people with a
(15:17):
taxable estate, and you're notgoing to see that a lot.
But there are some people outthere today 2025, who have over
$28 million and thereforethey're going to have a tax bill
.
There is not a lot we can do toprevent that, and the problem
is.
The problem this solves is youknow, you're going to have a tax
bill and say, someone dies andthey owe $10 million worth of
(15:41):
taxes.
They have a $50, $60 millionestate.
Well, a lot of these people,their wealth is not money
sitting in a bank.
Their wealth is real estate,business ventures, things like
that, things like that.
(16:02):
And for the family to have tocome up with $10 million within
nine months of your death can bedifficult.
You're having to sell $10million worth of property, kind
of in a fire sale, to get itsold and closed and the funds
transferred.
That's going to be difficultand could be expensive, because
to generate $10 million fromthat, you may have to sell $15
or $20 million worth of stuff.
(16:23):
Well, that's greatly reducedthe estate of this person,
whereas if you just have anirrevocable life insurance
policy, it's got to beirrevocable because life
insurance is part of your estateunless it is in an irrevocable
trust.
So therefore, you buy a $10million.
Life insurance is part of yourestate unless it is in an
irrevocable trust.
So therefore, you create this,you buy a $10 million life
insurance policy, put it intothis irrevocable life insurance
(16:45):
trust.
So now, at your death, $10million goes into the trust.
The kids can use that $10million, pay the tax, tell the
IRS to move on down the road,and the assets of the estate
don't have to be liquidated.
Super cool, super nice, and itcan really help families out.
So that's when irrevocabletrusts are good.
Okay, I kind of went off on atangent on the Medicaid asset
(17:08):
protection trust, but here is alist of why irrevocable trusts
may not be appropriate.
So, number one clienthesitation.
I do something very weird thatpeople are like really, but I
can tell you, I've been there, Idid it the other way and it bit
me, and so I decided afterabout the second or third of
(17:28):
these went south on me, I waslike I am not doing this anymore
.
Here's the way that I'm goingto do it.
And so here's the way I do whensomeone comes into me and they
want to do like the MedicaidAsset Protection Trust, I
explain it to them and they'relike absolutely, let's do that.
That's the best idea I've everheard of, let's do it.
And I'm like nope, not today.
(17:48):
This is an irrevocable trust.
You can't change this veryeasily.
You are losing control, you'relosing benefit of this.
It's a great tool.
I highly recommend it, but Iwant you to think about it.
I want you to go home.
We're going to schedule anappointment in two or three
weeks.
I want you to sleep on it.
Come back in two or three weeks.
You're probably going to havesome questions.
(18:09):
You're going to think aboutsome things.
Let probably going to have somequestions.
You're going to think aboutsome things.
Let's have another meeting andlet's talk about it.
And if at that meeting, after Ianswer your questions or we
discuss it further, and youstill want to do it, absolutely
let's do it.
Losing three weeks in afive-year time you know, look
back is not that much, and thereason I do that is there were
(18:29):
quite a few of these that I soldand they're like absolutely,
let's do it.
I'm like okay, pay me half thefee and then we'll pay the other
half.
And so I go off and I startdoing it.
I do the trust, I spend thetime and effort of drafting this
trust, getting it absolutelyright, and then, a week or two
later, they call me.
It's like yeah, I thought aboutit and one of the big reasons
(18:51):
is they talked to theirfinancial advisor and they're
like yeah, I don't think I wantto do that.
I changed my mind.
You're like well, and I charge achunk of money for this?
Okay, generally $7,500.
And so they just paid you$3,750, $3,750.
You're like well, the contractsays I've earned this first half
, so sorry.
(19:11):
And they're like what, youhaven't done anything for me.
I want my $33,750 back.
You're like no, this is worth acontract.
And they're like oh, this isridiculous and it's a fight.
Okay, and you either keep themoney and have an angry client
out there dissing you onFacebook and leaving a bad
Google review and everything, oryou refund the $3,750 after
(19:36):
you've already spent a number ofhours on this.
That is all easily solved bynot letting them sign up on day
one.
Okay, tell them, I appreciateyour enthusiasm, but I want you
to go think about it and theflip side of that.
When you bring this up to aclient and they're like I don't
like that idea, okay, well, Ijust thought I'd bring it up.
(19:58):
But you understand, you losecontrol, you lose benefit and
you don't like that.
Okay, but please remember.
And what I would say whensomeone says I don't like that,
tell them look what's in thetrust will be protected from
Medicaid and will go to yourheirs.
Okay, I want you to just thinkabout that.
Yes, you've spent the lastdecade or so knowing that you
(20:20):
have $3 million, $4 million, $5million in the bank.
Okay, I cannot get youqualified for Medicaid with $3,
$4, $5 million.
All right, or at least anytimesoon.
Okay, you will pay for fiveyears, but with this trust I can
get you down to be much morereasonable and I can get you on
(20:40):
Medicaid and get the rest ofthis money to your spouse or we
can if you're single, we canapply and get you on Medicaid in
less than five years if you'lldo this trust.
But understand, you don't wantto do it, you don't like it, but
just understand everything inthis trust.
But understand, you don't wantto do it, you don't like it, but
just understand everything inthis trust will be protected for
your kids.
And that last thought in theirhead when you tell them that
(21:00):
they're going to think aboutthat.
And I've had a number of clientswho were staunchly no, can't do
it, don't want to do it, I justcan't see myself not having
three or four million dollars inthe bank.
Ok, I get that.
A week later, six weeks later,six months later, sometimes
years later, they'll call backand say you know, I thought
about it and I don't need fourmillion dollars.
(21:24):
I'm 75 years old, I'm not goingto go to Europe anymore, I'm
not doing this or that orwhatever.
If I have three or four hundredthousand dollars, that's all
the money that I would ever need.
I'll take that so that I knowthat my estate will go to my
kids.
And you're like OK, come on inand let's discuss it.
And generally those people, oncethey come back in, they are
(21:46):
very dedicated.
You can go in, get on it, do itand keep your fee.
Ok, so I've had it both ways.
Absolutely yes, let's do it.
And then a few weeks later, no,don't want to do that.
And people are like oh no,absolutely not, I'm not doing
this.
A few weeks later it's like,yeah, I think that's a good idea
, actually.
Okay, good, here's some keythings.
(22:18):
I'm looking at my notes here.
Number two clearly,insufficient assets.
I think this is where peopleget all gung-ho and they put
people that don't havesufficient assets into the trust
.
High cost and complexity maynot justify the use for clients
with modest estates.
They need to have enough assetsfor this to make sense, okay.
Another client that this isprobably not good for is someone
who lacks long-term goals.
Okay, this is a very long-termplay.
I mean, this is irrevocable andit's done, and so you have to
(22:38):
think long-term.
And if someone's not thinkinglong-term, that's why, typically
, I don't sell these to anyoneunder the age of 70.
Just to be honest, medicaid Isaid protection trust.
Most people in your 50s and 60sare like I don't know, and that
makes sense because chances arethey're still 10, 15, 20 years
away from long-term care.
(22:59):
We can do something later.
Sometimes this trust is justsimply unnecessary for their
current needs.
There are some people that ifthey don't want to give up money
, they don't need Medicaid.
They never want to qualify forMedicaid because they have
enough money to self-fund.
There may be better alternativesGifting of smaller estates
hanging on to it until you needMedicaid and we can get one
(23:22):
spouse on Medicaid and keepeverything for the other spouse.
And sometimes that other spousehas long-term care insurance.
So therefore, we can get onespouse on, get them on Medicaid,
having all of the other assetsto the other spouse, and if that
spouse has long-term careinsurance, we don't need to
apply for Medicaid.
We don't have to do the giftand return or annuity or
whatever.
So just look at all of thealternatives and do what's in
(23:45):
the client's best interest.
So key factors to evaluatewhether you need this trust or
not.
So net worth asset types if allof their assets are in 401ks or
IRAs, an irrevocable trust isnot going to be good because
that's a taxable event.
Okay, so you know, sadlythere's been people with what I
(24:08):
call moderate estates.
You know 1 million, 1.5 million, but it's all in IRAs.
I'm like there's just you'regoing to have a hard time
qualifying because there couldbe a huge tax bill here and we
definitely don't want to do thistrust because that's going to
be one huge tax bill immediatelyand it's just not worth it.
I will say where this works andeven if the client doesn't have
(24:32):
a lot of money.
The family's just going to haveto work it out somehow is if
there's the prime family farm,family property that's been in
the home for generations and theparents don't live there.
They've moved away from that,moved into town and they are now
living in another house andthis is non-home property.
It will cause them to bedisqualified from Medicaid.
(24:54):
But the family doesn't want tosell.
It's like we've got to keepthis.
That's a perfect example of anirrevocable trust, an asset
protection trust for Medicaid.
You tell the family multipletimes in writing.
You have to understand puttingthis farm into this trust means
mom and dad will not qualify forMedicaid.
(25:15):
And I've even had some fun withclients and I said, hey, this
is the cheapest long-term carepolicy that you'll ever get.
And they're like what does thatmean?
I said, well, for $7,500 forthis trust, we're going to put
the farm into this trust.
You can't qualify for Medicaidfor the next five years and the
kids really want to keep thisfarm, so they're going to do
(25:35):
something.
They're going to pay money orthey're going to keep you or do
something, but they're going topay.
You're going to have five yearsof long-term care here for only
$7,500.
They're like I like the way youthink I said yeah, I know,
realize what the client'sobjectives are.
You've got to talk to yourclients.
Let your clients talk to youand figure out what their
(25:56):
objectives are.
You have to know your staterules.
That's why I'm concerned aboutthat attorney who wrote this
article in this magazine.
I'm not sure this guy fullyunderstands the Medicaid rules.
I plan to communicate with himand see if he knows something.
I don't, which I would be verysurprised, but that gives me
concern.
Okay, also, look at thelong-term impact of this.
Do the families get along?
(26:18):
What are going to be some ofthe pitfalls of this?
Unintended tax consequences,future needs, liquidity, things
like that have to be consideredbefore you do this.
All right.
So, in summary, the benefitsasset protection and credit
shielding, tax efficiency forhigh net worth clients and
long-term care planning,security for specific family
(26:40):
needs, long-term care, nursinghome, home care, things like
that.
Some of the drawbacksInflexibility.
It is difficult to change theterms of irrevocable trust,
potential or unintendedconsequences, tax implications,
grand tour, loss of access.
You have to make sure that theyunderstand that, and there can
be some administrativecomplexity.
(27:03):
Tax planning expenses can besignificant on these, and so you
have to make sure that thesepeople understand this.
Client communication is crucialhere.
You've got to make sure theclients understand this and
that's why I say don't let themhire you on the first day.
You have to make sure theyunderstand that and I sometimes
will follow that up with aletter explaining the benefits
(27:25):
and the drawbacks of this trust,so that they have it in writing
and they understand but theydon't make a rash sudden
decision.
If you're not familiar withtrust protectors, those are
fantastic.
That's one of the ways we canfairly easily change an
irrevocable trust.
So look into the trust protectorprovisions and powers of
(27:48):
appointment in case one of thebeneficiaries of this
irrevocable trust has problems.
I had one where the person hada major car wreck and was in a
nursing home and was on Medicaidand our trust was just.
It left it in trust, but itleft it in a general needs
special or, I'm sorry, it leftit in a general needs trust for
(28:11):
the benefit of that person,which would have kicked them off
of Medicaid.
And so my client calls me.
It's like, oh no, I've got thisirrevocable trust and she had
about $3 million and so $1million was going to go to each
child.
$1 million going to this childthat was now on Medicaid was
going to be a problem, sotherefore, we did a power of
appointment where, at her death,his share went to the other two
(28:35):
siblings rather than to him.
Problem solved.
You really need to encourageyour clients to collaborate with
financial advisors, taxprofessionals and, if you're not
an elder law expert, get withan elder law expert who
understands the ramifications ofMedicaid and how this works.
You've got to stay educated onthese.
A lot of the software companiesdo continuing education courses
(28:59):
on this all the time and Iencourage you stay up to date
with it.
It's a super cool tool, but itcan also be messed up very
easily.
All right, continue to thinkabout this.
Think very critically and don'tthrow this at every client.
It's not for every client.
Use it judicially, and when youdo it's really fun.
(29:22):
It solves a lot of problems,the clients love it and, if done
correctly, it's not going toblow up on you later on.
All right, I hope this helped.
Okay, please let me know if youhave any questions or concerns.
Todd, at TheElderLawCoachcom, Iwould love to be your coach and
if you would like to dive intothis even deeper and have me as
(29:44):
your coach.
I would be very honored.
Call the office, call Tricia,I'll put her number in there.
Or just go go to the website,the elder law coach dot com, and
there's a place there that youcan schedule online and I would
love to talk to you and we willsee you next time, ok, thanks.
Speaker 1 (30:02):
Thank you for joining this episode of the Elder Law
Coach podcast.
For those eager to take theirelder law practice to new
heights and are interested inTodd's acclaimed coaching
program, visitwwwtheelderlawcoachcom.
With Todd Whatley by your side,the journey to becoming an
elder law authority has neverbeen more achievable.
Until next time, keep learning,keep growing and stay
(30:26):
passionate about elder law.
Thank you.
Specialized experience, Whetheryou're an established attorney
looking to refine your expertiseor an emerging lawyer seeking a
successful foray into elder law, this is your masterclass.
Now let's get started with theluminary in the field.
Here's Todd Whatley.
Speaker 2 (00:37):
That's right.
This is the Elder Law Coachpodcast.
My name is Todd Whatley and Iam, as always, very thankful
that you are here, and todaywe're going to cover a topic
that I have seen become verypopular over the last year or so
.
I've been using these for quitesome time and I see estate
planning attorneys, andparticularly some elder law
(00:58):
attorneys, learn about these andthey're like ah, this is the
cure-all for everything and itis not.
What I'm talking about is anirrevocable trust, particularly.
I'll spend most of my timetalking about the Medicaid Asset
Protection Trust, but I willalso mention a few other trusts
and just talk about when thoseshould be used and when they
(01:20):
should not.
Okay, so just in case you're notfamiliar I mean, you obviously
you're an attorney, you knowwhat an irrevocable trust is,
but let me just give somefoundational definitions just so
you can understand.
And irrevocable trust isbasically a legal arrangement
where the grantor transfersassets into the trust and
relinquishes control andownership, and that is crucial
(01:43):
when you're dealing with theMedicaid Asset Protection Trust
and, like I tell clients, thisis kind of set in stone.
Now, we as attorneys nevercreate an irrevocable trust that
can't be changed somehow.
I just tell them.
It is quite difficult to change.
So once we do it, it's prettymuch set Okay.
The purpose of an irrevocabletrust typically is asset
(02:05):
protection, tax planning,medicaid planning and some
estate planning.
There are many, manymisconceptions here.
So many attorneys and some ofthe public assume that an
irrevocable trust is very rigid,overly complicated, and they
can be, and they should be tosome point.
(02:26):
But there are some substantialbenefits to giving up control,
giving up the benefit from thattrust.
Okay, all right.
Some common scenarios where youwill see irrevocable trust okay
, where they are appropriate.
Okay, like I said, probably thenumber one way that I use
irrevocable trust is withMedicaid and long term care
(02:47):
planning.
Done correctly, this willprotect the assets while
qualifying for Medicaid.
It gets the assets away fromyour estate according to
Medicaid, so that they're gone,they're out there and Medicaid
cannot come after them.
They're out there and Medicaidcannot come after them.
Okay, now, since you arerelinquishing control of those
(03:13):
assets, then that is seen as agift and therefore you are
subject to the five-year lookback.
Okay, and you need to be awareof that.
That's where I see a lot ofattorneys messing up is someone
comes in with a house and$100,000, $200,000 in the bank
and investments and they're likeoh, we need to protect the
house, so we put the house intoan irrevocable trust.
Well, that's great if you canmake it five years.
(03:35):
But the problem is I'm prettyconservative on this and the
last thing I want is for myclient to do this and then have
a stroke next week and neednursing home care for the next
five years.
You don't have enough moneywith one or $200,000 in the bank
to cover five years worth ofnursing home care and, if done
(03:56):
correctly, you should not beable to give that house back to
the person.
One thing on this let me justkind of take a detour very
quickly is when you do this, youneed to be careful, because
some states and I live in onethat is very particular about
this they have made it clearthat if your state allows you to
(04:17):
reduce a penalty I'm prettysure all states allow you to
eliminate a penalty.
If you give back all of theassets, that will eliminate the
penalty.
But here's the key thing mystate, arkansas, is very
particular that the gift has tobe returned from the person or
the entity that it was gifted to, and the terms of an
(04:40):
irrevocable asset protectiontrust is that the grantor, the
Medicaid applicant, is not thebeneficiary of this trust, and
so therefore it is a violationof the terms of the trust for
the trustee to transfer the homefrom the trust back to the
applicant.
The trust says you can't dothat.
(05:00):
And I can see Medicaid sayingyou can't do that.
You can't give the house back.
You put it into an irrevocabletrust where the grantor was not
the beneficiary.
You're stuck with it, and insome states you might be able to
transfer it from the trust tothe lifetime beneficiary, one of
the kids, and the kid give thehouse back to the parent and
(05:21):
kind of argue with Medicaid thathey, you know, this is the
house that was gifted to thetrust and now it's back in their
name.
Well, I still think Medicaidcan say nope, this was given to
the trust and the trust did notgive it back.
So therefore we are notrecognizing the reduction or
elimination of the gift.
You see, that's where a lot ofpeople jump into these and they
(05:46):
do it quickly and they think, oh, this is the cure-all for
everything and it's not.
You have to be careful aboutthis Now.
Then there's the other issuesof who's the trustee, who's the
beneficiary.
I do a public speaking eventevery first Thursday at this one
place public speaking eventevery first Thursday at this one
(06:06):
place and the director of thisplace brought me a local
caregiver or caregiving inArkansas and it's a magazine
that you can buy ads in and ithas articles.
And one of the advertisers wasan elder law attorney in
Arkansas and he wrote an articlein the director of this
facility, he's a physician.
And he said the director ofthis facility, he's a physician.
(06:29):
And he said I want you to readthis article and tell me if you
agree with the determinations ofthis attorney.
And I kind of looked at him.
He said I'm just curious whatyou think.
I was like okay, and so I hadfinished my event and I needed
to get back to the office.
So he just gave me the magazineand so I got back to the office
and I read it and I was like,oh no, this is an Arkansas
attorney who I have been told bythe state that if you have a
(06:54):
trust where the applicant is thetrustee or the beneficiary in
any way, it is a countable asset.
I've been told that I don't riskit.
My irrevocable trust makes thegrantor and the future Medicaid
applicant, not the trustee andnot the beneficiary in any way
whatsoever.
This guy's doing trust, withthe grantor as the trustee and
(07:18):
they have income benefits fromthe trust.
And I've been told by DHS that,even though it really doesn't
follow federal law, that theyhave told me that they're going
to deem it to be a accountableresource and we can fight it out
in court, which is a two-yearfight while the nursing home
bill's building up and we don'tknow that we're going to win.
(07:39):
And so I am very conservativeon this.
I will fight and fight andfight on things that I know I'm
right and I know that I shouldwin, but on this topic I don't
know that and I don't want atwo-year fight over this issue
that I'm not absolutely sure on.
And it's an easy fix you justtell your client you're not the
(08:01):
trustee, you're not thebeneficiary and boom, it is
absolutely protected fromMedicaid once you do that, okay,
but this guy's doing this, andthat gets into the issue of
whatever goes into.
The trust can't come back tothe grantor and therefore you
can't reduce or eliminate thegift and you're stuck with this
(08:22):
gift regardless.
And so please be careful whenyou're doing these.
I reserve these for higher networth people.
In Arkansas, nursing homes areno more than $10,000 a month.
Easy number to calculate that's$600,000.
When you factor in income, thatreduces that maybe down to
(08:43):
$400,000, $ $500.
So generally I don't do anirrevocable trust Medicaid Asset
Protection Trust unless it isworth it.
There are enough assets for usto be able to put enough in
there for the trust to makesense and keep out about
$400,000.
(09:03):
Okay, and that does varydepending on income, but I feel
safe.
The client doesn't feel broke,they can go on vacation, they
can buy a new car, they can dowhat they want to with that
$400,000, knowing that everymonth they get through this
five-year penalty that's $10,000.
They, knowing that every monththey get through this five-year
penalty that's $10,000 theydon't have to pay and so
basically they can spend 10,000bucks a month within reason and
(09:27):
know that they've got enoughmoney to get them through the
remainder of the five-year.
Look back Okay.
So that's my spiel on theMedicaid Asset Protection Trust.
Now there are some otherirrevocable trusts and we use
those sometimes in estateplanning just pure estate
planning, not so much Medicaid.
And this tends to come intoplay with your high net worth
(09:49):
people a trust that you cantransfer assets into.
That are either seen as giftsor you can make it so that
you're within the annual giftingexemption and you don't have to
fill out gift tax returns andit doesn't reduce your lifetime
exemption.
And so there are some truststhere and, particularly when one
(10:09):
spouse passes away, you wantthe lifetime exemption or a
portion of it to go into anirrevocable trust so that it is
outside the estate of thesurviving spouse and you can
save a whole lot of taxes.
You basically double theexemption amount and you can put
some terms on that so that thesurviving spouse can benefit
(10:31):
from it, but it is outside oftheir estate.
Some states have what are knownas the Domestic Asset Protection
Trust.
Arkansas has just fairlyrecently, created that.
I have not done one yet.
I am researching it and I'mstarting to mention that to
clients as an option, and it issimply what it says.
(10:51):
It's you're able to put yourassets in there and it is
protected from creditors,bankruptcy, divorce, things like
that.
After two years you can't do it, knowing that there's a debt
and that protection does notkick in for two years, and so
that's really good for high riskprofessionals, physicians, some
attorneys, business owners,people like that.
(11:12):
This domestic asset protectiontrust, which is obviously
irrevocable, is a huge componentof some people's estate and the
benefit of protecting fromcreditors is huge in depth.
(11:40):
But a lot of times, particularlyafter the death of the parents
and they leave their estate intoa special needs trust, that
trust becomes irrevocable sothat the trustee can't change it
, can't mess things up, can'tpull the money from any so that
the money benefits anyone otherthan the disabled person.
I will leave those revocableduring the lifetime of the
parent, particularly becausethere's not much money in it.
(12:00):
We create it.
It's there, ready, willing andable to accept money.
But typically if the parentsare alive, they're just going to
do things for their disabledchild.
They don't need the trust.
But it's there and if someoneelse wants to leave money into
it, a lot of times I'll do thiscool little trick that I think
elder counsel taught me.
This is make the trustrevocable and if someone else
(12:24):
wants to leave money into thetrust, you can put language in
the trust that says if thistrust accepts over $25,000,
$50,000, whatever that number is, then even during the life of
the parents it becomesirrevocable.
That way the grandparents anduncles, somebody can say, hey, I
would love to leave money tothis disabled child, but I'm a
(12:45):
little nervous because it'srevocable.
And if I leave it in there andit's revocable, the parents can
cancel this trust, pull themoney out of the trust for their
benefit and not for the child.
And so, therefore, to fix thathesitation, we'll put language
in the trust for their benefitand not for the child.
And so, therefore, to fix thathesitation, we'll put language
in the trust that says thistrust becomes irrevocable once a
set amount of money goes in.
(13:06):
We don't want someone puttingin $5,000 and having to lock it
down.
It needs to be a substantialamount of money.
It's like, hey, if you're goingto be serious about this,
$25,000, $50,000, whatever,that's the number.
I have also recently started,just because I've just never had
clients that, to be honest, Ididn't fully understand these.
(13:26):
I knew what they were, but Idid not understand them, and so
therefore, I did not recommendthem since I did not understand
them.
Now, working with a financialadvisor very closely, we have
done a number of charitableremainder trust or charitable
lead trust, basically justcharitable giving and
irrevocable trust that you canput highly appreciated assets
(13:49):
into and therefore not have topay the capital gains benefit
from those assets during yourlifetime and then it ultimately
goes to a charity at the time ofyour death and those can save
people hundreds of thousands, ifnot millions of dollars, in
taxes and do what they want.
And particularly if a clientcomes to you and they mention I
(14:10):
really want to benefit somecharities, that's great.
Okay, let's benefit charities.
But benefiting charities atdeath is great, but you don't
get a tax benefit for that.
Why not?
Let's do it now.
Or let's still benefit thecharity at your death, but let's
get a tax benefit for thattoday and you still benefit from
that money today.
(14:32):
If that doesn't make sense toyou, I probably should do a full
podcast just on that topic,because once I learned about it,
it really opened up the doorsand allowed me to, within my
fiduciary duty to my client, sayhey, do this trust?
This is a trust, that taxdeduction charitably oriented,
you get the income off of it,you don't have to pay taxes on
(14:54):
this.
Now.
I mean, it's just a beautiful,beautiful tool and if you don't
fully understand it or you don'thave a financial advisor who
fully understands it, give us acall because we can definitely
walk you through that, okay.
And then finally, probably oneof the most popular irrevocable
trusts is the irrevocable lifeinsurance trust.
Those are beautiful tools also,particularly for people with a
(15:17):
taxable estate, and you're notgoing to see that a lot.
But there are some people outthere today 2025, who have over
$28 million and thereforethey're going to have a tax bill
.
There is not a lot we can do toprevent that, and the problem
is.
The problem this solves is youknow, you're going to have a tax
bill and say, someone dies andthey owe $10 million worth of
(15:41):
taxes.
They have a $50, $60 millionestate.
Well, a lot of these people,their wealth is not money
sitting in a bank.
Their wealth is real estate,business ventures, things like
that, things like that.
(16:02):
And for the family to have tocome up with $10 million within
nine months of your death can bedifficult.
You're having to sell $10million worth of property, kind
of in a fire sale, to get itsold and closed and the funds
transferred.
That's going to be difficultand could be expensive, because
to generate $10 million fromthat, you may have to sell $15
or $20 million worth of stuff.
(16:23):
Well, that's greatly reducedthe estate of this person,
whereas if you just have anirrevocable life insurance
policy, it's got to beirrevocable because life
insurance is part of your estateunless it is in an irrevocable
trust.
So therefore, you buy a $10million.
Life insurance is part of yourestate unless it is in an
irrevocable trust.
So therefore, you create this,you buy a $10 million life
insurance policy, put it intothis irrevocable life insurance
(16:45):
trust.
So now, at your death, $10million goes into the trust.
The kids can use that $10million, pay the tax, tell the
IRS to move on down the road,and the assets of the estate
don't have to be liquidated.
Super cool, super nice, and itcan really help families out.
So that's when irrevocabletrusts are good.
Okay, I kind of went off on atangent on the Medicaid asset
(17:08):
protection trust, but here is alist of why irrevocable trusts
may not be appropriate.
So, number one clienthesitation.
I do something very weird thatpeople are like really, but I
can tell you, I've been there, Idid it the other way and it bit
me, and so I decided afterabout the second or third of
(17:28):
these went south on me, I waslike I am not doing this anymore
.
Here's the way that I'm goingto do it.
And so here's the way I do whensomeone comes into me and they
want to do like the MedicaidAsset Protection Trust, I
explain it to them and they'relike absolutely, let's do that.
That's the best idea I've everheard of, let's do it.
And I'm like nope, not today.
(17:48):
This is an irrevocable trust.
You can't change this veryeasily.
You are losing control, you'relosing benefit of this.
It's a great tool.
I highly recommend it, but Iwant you to think about it.
I want you to go home.
We're going to schedule anappointment in two or three
weeks.
I want you to sleep on it.
Come back in two or three weeks.
You're probably going to havesome questions.
(18:09):
You're going to think aboutsome things.
Let probably going to have somequestions.
You're going to think aboutsome things.
Let's have another meeting andlet's talk about it.
And if at that meeting, after Ianswer your questions or we
discuss it further, and youstill want to do it, absolutely
let's do it.
Losing three weeks in afive-year time you know, look
back is not that much, and thereason I do that is there were
(18:29):
quite a few of these that I soldand they're like absolutely,
let's do it.
I'm like okay, pay me half thefee and then we'll pay the other
half.
And so I go off and I startdoing it.
I do the trust, I spend thetime and effort of drafting this
trust, getting it absolutelyright, and then, a week or two
later, they call me.
It's like yeah, I thought aboutit and one of the big reasons
(18:51):
is they talked to theirfinancial advisor and they're
like yeah, I don't think I wantto do that.
I changed my mind.
You're like well, and I charge achunk of money for this?
Okay, generally $7,500.
And so they just paid you$3,750, $3,750.
You're like well, the contractsays I've earned this first half
, so sorry.
(19:11):
And they're like what, youhaven't done anything for me.
I want my $33,750 back.
You're like no, this is worth acontract.
And they're like oh, this isridiculous and it's a fight.
Okay, and you either keep themoney and have an angry client
out there dissing you onFacebook and leaving a bad
Google review and everything, oryou refund the $3,750 after
(19:36):
you've already spent a number ofhours on this.
That is all easily solved bynot letting them sign up on day
one.
Okay, tell them, I appreciateyour enthusiasm, but I want you
to go think about it and theflip side of that.
When you bring this up to aclient and they're like I don't
like that idea, okay, well, Ijust thought I'd bring it up.
(19:58):
But you understand, you losecontrol, you lose benefit and
you don't like that.
Okay, but please remember.
And what I would say whensomeone says I don't like that,
tell them look what's in thetrust will be protected from
Medicaid and will go to yourheirs.
Okay, I want you to just thinkabout that.
Yes, you've spent the lastdecade or so knowing that you
(20:20):
have $3 million, $4 million, $5million in the bank.
Okay, I cannot get youqualified for Medicaid with $3,
$4, $5 million.
All right, or at least anytimesoon.
Okay, you will pay for fiveyears, but with this trust I can
get you down to be much morereasonable and I can get you on
(20:40):
Medicaid and get the rest ofthis money to your spouse or we
can if you're single, we canapply and get you on Medicaid in
less than five years if you'lldo this trust.
But understand, you don't wantto do it, you don't like it, but
just understand everything inthis trust.
But understand, you don't wantto do it, you don't like it, but
just understand everything inthis trust will be protected for
your kids.
And that last thought in theirhead when you tell them that
(21:00):
they're going to think aboutthat.
And I've had a number of clientswho were staunchly no, can't do
it, don't want to do it, I justcan't see myself not having
three or four million dollars inthe bank.
Ok, I get that.
A week later, six weeks later,six months later, sometimes
years later, they'll call backand say you know, I thought
about it and I don't need fourmillion dollars.
(21:24):
I'm 75 years old, I'm not goingto go to Europe anymore, I'm
not doing this or that orwhatever.
If I have three or four hundredthousand dollars, that's all
the money that I would ever need.
I'll take that so that I knowthat my estate will go to my
kids.
And you're like OK, come on inand let's discuss it.
And generally those people, oncethey come back in, they are
(21:46):
very dedicated.
You can go in, get on it, do itand keep your fee.
Ok, so I've had it both ways.
Absolutely yes, let's do it.
And then a few weeks later, no,don't want to do that.
And people are like oh no,absolutely not, I'm not doing
this.
A few weeks later it's like,yeah, I think that's a good idea
, actually.
Okay, good, here's some keythings.
(22:18):
I'm looking at my notes here.
Number two clearly,insufficient assets.
I think this is where peopleget all gung-ho and they put
people that don't havesufficient assets into the trust
.
High cost and complexity maynot justify the use for clients
with modest estates.
They need to have enough assetsfor this to make sense, okay.
Another client that this isprobably not good for is someone
who lacks long-term goals.
Okay, this is a very long-termplay.
I mean, this is irrevocable andit's done, and so you have to
(22:38):
think long-term.
And if someone's not thinkinglong-term, that's why, typically
, I don't sell these to anyoneunder the age of 70.
Just to be honest, medicaid Isaid protection trust.
Most people in your 50s and 60sare like I don't know, and that
makes sense because chances arethey're still 10, 15, 20 years
away from long-term care.
(22:59):
We can do something later.
Sometimes this trust is justsimply unnecessary for their
current needs.
There are some people that ifthey don't want to give up money
, they don't need Medicaid.
They never want to qualify forMedicaid because they have
enough money to self-fund.
There may be better alternativesGifting of smaller estates
hanging on to it until you needMedicaid and we can get one
(23:22):
spouse on Medicaid and keepeverything for the other spouse.
And sometimes that other spousehas long-term care insurance.
So therefore, we can get onespouse on, get them on Medicaid,
having all of the other assetsto the other spouse, and if that
spouse has long-term careinsurance, we don't need to
apply for Medicaid.
We don't have to do the giftand return or annuity or
whatever.
So just look at all of thealternatives and do what's in
(23:45):
the client's best interest.
So key factors to evaluatewhether you need this trust or
not.
So net worth asset types if allof their assets are in 401ks or
IRAs, an irrevocable trust isnot going to be good because
that's a taxable event.
Okay, so you know, sadlythere's been people with what I
(24:08):
call moderate estates.
You know 1 million, 1.5 million, but it's all in IRAs.
I'm like there's just you'regoing to have a hard time
qualifying because there couldbe a huge tax bill here and we
definitely don't want to do thistrust because that's going to
be one huge tax bill immediatelyand it's just not worth it.
I will say where this works andeven if the client doesn't have
(24:32):
a lot of money.
The family's just going to haveto work it out somehow is if
there's the prime family farm,family property that's been in
the home for generations and theparents don't live there.
They've moved away from that,moved into town and they are now
living in another house andthis is non-home property.
It will cause them to bedisqualified from Medicaid.
(24:54):
But the family doesn't want tosell.
It's like we've got to keepthis.
That's a perfect example of anirrevocable trust, an asset
protection trust for Medicaid.
You tell the family multipletimes in writing.
You have to understand puttingthis farm into this trust means
mom and dad will not qualify forMedicaid.
(25:15):
And I've even had some fun withclients and I said, hey, this
is the cheapest long-term carepolicy that you'll ever get.
And they're like what does thatmean?
I said, well, for $7,500 forthis trust, we're going to put
the farm into this trust.
You can't qualify for Medicaidfor the next five years and the
kids really want to keep thisfarm, so they're going to do
(25:35):
something.
They're going to pay money orthey're going to keep you or do
something, but they're going topay.
You're going to have five yearsof long-term care here for only
$7,500.
They're like I like the way youthink I said yeah, I know,
realize what the client'sobjectives are.
You've got to talk to yourclients.
Let your clients talk to youand figure out what their
(25:56):
objectives are.
You have to know your staterules.
That's why I'm concerned aboutthat attorney who wrote this
article in this magazine.
I'm not sure this guy fullyunderstands the Medicaid rules.
I plan to communicate with himand see if he knows something.
I don't, which I would be verysurprised, but that gives me
concern.
Okay, also, look at thelong-term impact of this.
Do the families get along?
(26:18):
What are going to be some ofthe pitfalls of this?
Unintended tax consequences,future needs, liquidity, things
like that have to be consideredbefore you do this.
All right.
So, in summary, the benefitsasset protection and credit
shielding, tax efficiency forhigh net worth clients and
long-term care planning,security for specific family
(26:40):
needs, long-term care, nursinghome, home care, things like
that.
Some of the drawbacksInflexibility.
It is difficult to change theterms of irrevocable trust,
potential or unintendedconsequences, tax implications,
grand tour, loss of access.
You have to make sure that theyunderstand that, and there can
be some administrativecomplexity.
(27:03):
Tax planning expenses can besignificant on these, and so you
have to make sure that thesepeople understand this.
Client communication is crucialhere.
You've got to make sure theclients understand this and
that's why I say don't let themhire you on the first day.
You have to make sure theyunderstand that and I sometimes
will follow that up with aletter explaining the benefits
(27:25):
and the drawbacks of this trust,so that they have it in writing
and they understand but theydon't make a rash sudden
decision.
If you're not familiar withtrust protectors, those are
fantastic.
That's one of the ways we canfairly easily change an
irrevocable trust.
So look into the trust protectorprovisions and powers of
(27:48):
appointment in case one of thebeneficiaries of this
irrevocable trust has problems.
I had one where the person hada major car wreck and was in a
nursing home and was on Medicaidand our trust was just.
It left it in trust, but itleft it in a general needs
special or, I'm sorry, it leftit in a general needs trust for
(28:11):
the benefit of that person,which would have kicked them off
of Medicaid.
And so my client calls me.
It's like, oh no, I've got thisirrevocable trust and she had
about $3 million and so $1million was going to go to each
child.
$1 million going to this childthat was now on Medicaid was
going to be a problem, sotherefore, we did a power of
appointment where, at her death,his share went to the other two
(28:35):
siblings rather than to him.
Problem solved.
You really need to encourageyour clients to collaborate with
financial advisors, taxprofessionals and, if you're not
an elder law expert, get withan elder law expert who
understands the ramifications ofMedicaid and how this works.
You've got to stay educated onthese.
A lot of the software companiesdo continuing education courses
(28:59):
on this all the time and Iencourage you stay up to date
with it.
It's a super cool tool, but itcan also be messed up very
easily.
All right, continue to thinkabout this.
Think very critically and don'tthrow this at every client.
It's not for every client.
Use it judicially, and when youdo it's really fun.
(29:22):
It solves a lot of problems,the clients love it and, if done
correctly, it's not going toblow up on you later on.
All right, I hope this helped.
Okay, please let me know if youhave any questions or concerns.
Todd, at TheElderLawCoachcom, Iwould love to be your coach and
if you would like to dive intothis even deeper and have me as
(29:44):
your coach.
I would be very honored.
Call the office, call Tricia,I'll put her number in there.
Or just go go to the website,the elder law coach dot com, and
there's a place there that youcan schedule online and I would
love to talk to you and we willsee you next time, ok, thanks.
Speaker 1 (30:02):
Thank you for joining this episode of the Elder Law
Coach podcast.
For those eager to take theirelder law practice to new
heights and are interested inTodd's acclaimed coaching
program, visitwwwtheelderlawcoachcom.
With Todd Whatley by your side,the journey to becoming an
elder law authority has neverbeen more achievable.
Until next time, keep learning,keep growing and stay
(30:26):
passionate about elder law.
Popular Podcasts
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
Dateline NBC
Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com
24/7 News: The Latest
The latest news in 4 minutes updated every hour, every day.