Consider an Asset Protection Trust in Your Twilight Years

By Law Offices of Kreisher & Gregorowicz on July 26, 2017

Estate PlanningAs we get older, it is only natural to want to protect our property and other assets; to ensure that they go to loved ones and family rather than being subject to government seizure.

There are different ways to protect your assets in Pennsylvania, but one option worth considering is an asset protection trust. A trust lets you keep real estate, investments, and other assets within your family, even if you or a loved one ends up in a nursing home or similar facility.

What Is an Asset Protection Trust?

An asset protection trust is a legal agreement between members of a family to manage assets placed in that trust. They are not revocable, so once assets are placed into the trust, they cannot be removed until the death of the person who created the trust. Once placed within the trust, however, all assets are sheltered. For example, when a person’s real estate and savings are considered while applying for Medicaid, the trust assets are separate (this is a common way to offset the expense of a nursing home or assisted living facility).

Can’t I Just Gift My Assets to My Children?

While you can gift real estate and other assets to your children, doing so comes with potential problems.

Even though your children may control the assets within a trust, they do not legally own them. That means there are no ownership issues that can arise if your children are involved in a divorce, civil lawsuit, or other complication. This protects your own assets and your loved ones.

What Else Should I Know?

An asset protection trust is a family trust, which means there is no involvement from a bank or similar organization. Family members are involved and manage the account, so you can rest easy knowing that your children, or whomever you name in the trust, are in control. It is important to act quickly when considering this option, however, to avoid potential problems. When Medicaid is needed to help offset expenses, any assets owned in the last five years are considered. This means that at least five years must pass from the formation of the trust and when you or a loved one applies for Medicaid to ensure the contents of the trust are protected.

 Call Us to Make Sure Your Assets Are Protected!

Protecting your assets is not something you should try to do by yourself. Call us at the Law Offices of Kreisher & Gregorowicz today at (570) 784-5211 to speak to an experienced elder law and asset protection attorney.

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Posted in: Estate Planning