Listen to Lawrence Letter: Can a Medicaid trust pay for rent for an interim home?

DAVIDOWLAW Blog Post

Dear Clients and Friends:
Here is a question that I get a lot and have covered in numerous past LISTEN TO LAWRENCE LETTERS. However, I will keep answering it because it is so important.
CLIENT QUESTION:
I am not sure I have seen this question covered in past newsletters. My parents set up an irrevocable Medicaid trust with you. It contains their current residence. They would like to move and sell the house, purchasing a new home near us. However, it is likely that they will need to rent for a period of time before we are able to find a new home. Can the trust pay for the rental cost? Thank you.
MY RESPONSE:
NO, NO, NO, NO!!!!!!!
The trust can never pay a personal bill for the grantors/settlors of the trust (your parents). Rent would be a personal bill. Paying a personal bill, even once, even for a very small amount, destroys the trust for Medicaid purposes.
I hope this helps! Please forward this information to your friends and relatives to share these informative answers to some very commonly asked questions.
And, if anyone you know would like to receive this
Listen to Lawrence Letter, just have them email me at
info@davidowlaw.com and I’ll add them to the list!
As always, please send me your questions. If you are thinking about it, others are probably too, so my answers will no doubt help you and many others.
Let’s stay connected.
Stay safe!
Until next time,
peace, health and happiness,
Lawrence Eric Davidow