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Medicaid Compliant Annuity vs Medicaid Trust

When buying a Medicaid compliant annuity know total combined income

Medicaid Trust vs Medicaid Compliant Annuity

In addition to the discussed Medicaid compliant annuity, a Medicaid trust work in a similar way. Some clients will prefer to use a Medicaid trust instead of an annuity for two main reasons. The first reason is that some of the assets are better protected in a trust which can help to avoid liquidation and tax liabilities. The second reason is that there are very few attorneys that are also licensed to use certain insurance products. This leads to the over reliance on annuity trusts, which are very costly. Annuity best way to protect assets such as 401(k) and IRA
Some attorneys will state that the annuity is the best way to protect assets such as a 401(k) and IRA. The owner would be requires to incur all of the tax liabilities that are associated with the distribution of the assets if these plans were to be liquefied. However, it is possible to roll these assets over into a Medicaid compliant annuity. The payout structure would then meet the rules for Medicaid. The payout can occur over a period of time, which is usually when the co-payments are considered to be a partially deductible expense. These expenses can sometimes offset the tax liabilities.

Medicaid complaint annuities will combine with pension payments and Social Security payments