Pooled Income Trusts -LEL

A Pooled Income Trust is a specialized type of Supplemental Needs Trust that is often used by disabled people so that they can receive Medicaid benefits without having to use "excess" income in order to remain eligible.

Medicaid currently has limitations as to how much income a person may receive and still be eligible to receive medical benefits. When an individuals income exceeds that amount, they are required to use the excess as a "spend down" before Medicaid will pick up health related expenses.

In the case of those who are disabled, a Pooled Income Trust can be set up so that they can avoid having to use this excess income for medical expenses and can instead use it for living and other expenses. Once the trust has been established, any income over and above the Medicaid limitations is sent to the trust and is then used by the trust to pay for the individuals living expenses - such as housing payments, food, clothing, etc. The money is sent directly from the trust to a third party at the direction of the grantor or someone designated to represent the grantor.

In order for a person to be eligible to set up a Pooled Income Trust, he or she must have a disability evaluation or already have been determined to be disabled by the Social Security Administration. Individuals who are not considered disabled by the Social Security Adminstration can have an evaluation and must submit specific forms to Medicaid so they can make a determination regarding disability.

Once it has been decided that an individual qualifies as disabled, a joinder agreement must be completed. This agreement is between the beneficiary and the trust. The agreement can be signed by the disabled individual or anyone who has the authority to make decisions for the individual. There are additional limitations for those who set up this type of trust after reaching the age of 65. Before a Pooled Income Trust can be made active, they are required to be reviewed by a government attorney.

Those who believe that they qualify for a Pooled Income Trust may want to contact a qualified attorney for advice on creating this type of trust as the paperwork required can be lengthy and very detailed.

*This article was written for informational purposes only and is not intended to be used as legal advice. Those who require legal advice should contact a licensed attorney.

If you would like more information on pooled income trusts please visit the legal website of Long Island Lawyer Andrew M. Lamkin.