| LET’S DO THIS AGAIN.
I have answered today’s question many times before…but it is so important I will do it again…and probably again:
CLIENT QUESTION:
Can a trustee remove funds from the irrevocable Medicaid trust investment account to pay the HOA for the condo in the trust? Can the trustee also use funds to pay expenses such as insurance and renovations for the condo? Can the trustee also purchase a car for us from the trust? To summarize, we’d like to use funds from the trust to pay expenses without violating the trust. We’re looking for guidance. Thank you.
MY RESPONSE:
NO NO NO NO NO!
The trust can not pay your personal expenses. You are personally responsible for the taxes, insurance, maintenance, HOA fees, and renovations. You are personally responsible for your car. If the trust pays your personal expenses, then the trust no longer works. You cannot violate the terms of the trust.
On the other hand, the trust can distribute money to the trust beneficiaries, usually your children. Before they do this though, they will need to obtain your written consent. Once the children get the money they can do anything they want with it…after all it is their money at that point. One thing they can do with the money is put a new pool in their backyard. If so, I hope you get an invite!😊 On the other hand, they can also buy you a new car for your birthday or help you with your HOA fees. |
