Mar 03, 2021 · The VA made vast changes to the program starting October 18, 2018. The highlighted changes include: Hard asset cap of $123,600 (no such cap existed before) Homestead property not an asset for VA benefits unless the lot size exceeds 2 acres. Three year look-back period for VA benefits, which is similar to the Florida Medicaid look-back period.
The Use of Irrevocable Trusts in VA Pension Planning. By Valerie L. Peterson, J.D. CEO ElderCounsel, LLC. Submitted by ElderCounsel, LLC. The Department of Veterans Administration (VA) has provided new eligibility rules for wartime Veterans and surviving spouses of wartime Veterans who are eligible for VA pension benefits.
May 21, 2018 · A VA asset protection trust is specifically designed to protect a veteran’s assets while still maintaining eligibility for benefits that are unique to veterans. This is an irrevocable trust, in that the assets cannot be removed from the trust once they are placed in it. Since the veteran no longer has any ownership interest in the assets ...
One of the most important roles for an irrevocable trust is asset protection in the event of a long term care illness, such as Alzheimer’s, dementia, Parkinson’s, stroke, etc. The goal is to place assets into a properly drafted irrevocable trust, which minimizes loss of control while maximizing future eligibility for Medi-Cal and Veterans ...
A VA asset protection trust does what the name says: It protects a veteran's assets so their eligibility can be maintained for other benefits unique to veterans. The VA asset protection trust is classified as an irrevocable trust, meaning the assets can not be removed once they are placed in the trust.Dec 31, 2020
While it isn't a common occurrence, veterans and military members may be able to purchase with a VA home loan through a revocable inter vivos trust. This is a legal and financial arrangement where you put assets into a trust to be utilized during your lifetime.Oct 12, 2020
The VA Home Loan Office told them that if a home is placed in trust, then both of the individuals had to qualify for the home loan — meaning both had to be veterans....Beware: Trusts and VA Home Loans Don't Mix.CharacteristicRevocable Living TrustsWillsProtection from court challengesXAvoid a conservatorshipXName guardians for childrenX12 more rows•Jun 12, 2018
You are paying for the veteran's burial and funeral costs. No other organization will reimburse you.Nov 24, 2021
Generally, a revocable inter vivos trust (sometimes called a "revocable living trust") is a written agreement between the individual creating the trust (who is commonly known as a "Settlor," "Grantor," or "Trustor") and the person or institution that is to manage the assets held in trust (commonly known as the "Trustee ...
VA Escrow Holdback In some cases, repairs can be completed after the loan closes. The borrower would need to put money to pay for these repairs in an escrow account. This is known as an escrow holdback. You'll typically be required to put 1.5 times the cost of repairs into the escrow account.Jul 29, 2020
The Department of Veterans Affairs (VA) offers group life insurance for veterans. You need to convert your Servicemembers' Group Life Insurance to Veterans' Group Life Insurance within 485 days to keep the same coverage....How much does life insurance for veterans cost?AgeMonthly premium75 and older$1,71210 more rows•Feb 8, 2022
VA makes financial planning and online will preparation services available at no cost to beneficiaries of: SGLI (Servicemembers' Group Life Insurance) TSGLI (Traumatic Injury Protection) FSGLI (Family Servicemembers' Group Life Insurance)
What Constitutes a Valid Will in Virginia?Age. The testator must be at least 18 years old.In Writing. ... Signed by the Testator. ... Competent. ... Voluntarily and of Their Free Will. ... Minimum of Two Witnesses. ... Self-Proving Affidavit Not Required, but Recommended. ... Holographic Will, Exception.Nov 5, 2018
The VA disability 10-year rule states that the U.S. Department of Veterans Affairs (VA) cannot eliminate a disability rating that has been in place for at least 10 years unless there is evidence of fraud. This 10-year period is calculated from the effective date of VA's original grant for service connection.Dec 31, 2021
Does the Department of Veterans Affairs (VA) pay for cremation? Unfortunately, the VA does not pay for cremation. However, it is possible to receive VA burial benefits for cremation. The VA does reimburse families pay for a portion of burial, funeral, and transportation costs related to a veteran's death.
SBP provides up to 55 percent of a service member's retired pay to an eligible beneficiary upon the death of the member. After the service member passes away, the SBP annuity is paid out monthly to the surviving spouse, or to the child or children of the member.Dec 23, 2021
A VA asset protection trust is specifically designed to protect a veteran’s assets while still maintaining eligibility for benefits that are unique to veterans. This is an irrevocable trust, in that the assets cannot be removed from the trust once they are placed in it. Since the veteran no longer has any ownership interest in ...
That trustee will have complete control over your assets and funds while they are in the trust, and there is not requirement that he or she take assets from the trust and give them to you if needed. As a result, having someone you trust act as trustee is crucial to the smooth operation of the trust and the protection of your assets.
However, if nursing home care becomes necessary prior to the five-year lookback period, the trust will have a mechanism to release funds to the beneficiary in a way that still preserves Medicaid eligibility. For a veteran, however, the situation is different.
As you can see, trusts can be complex, but there are a number of different types of trusts that may fit your situation. While you may be unsure that a trust will meet your needs, you can turn to Legacy Law Center for legal advice about the different options that are available to you.
Since the veteran no longer has any ownership interest in the assets placed in the irrevocable trust, they cannot be considered when determining the veteran’s eligibility for government assistance programs such as Medicaid and Veterans Aid & Attendance benefits, which can provide long-term care benefits if needed.
But, if that certainty is disrupted because of a medical emergency, and if keeping the irrevocable trust intact doesn’t make sense, there are mechanisms within the irrevocable trust to return the unused assets to you.
Such objectives and purposes range from asset protection to protection of government assistance benefits for an ill spouse or a person with disabilities. One of the most important roles for an irrevocable trust is asset protection in the event of a long term care illness, such as Alzheimer’s, dementia, Parkinson’s, stroke, etc.
The older adult needs a sense of emotional security because he or she must be ready to relinquish direct control over his or her assets.
Because the transfer of assets to an irrevocable trust is subject to a waiting period for Medi-Cal eligibility of 2.5 years, it is anticipated that the older adult will not need nursing home care for 2 or 3 years. If the older adult is a veteran or a widow (er) of a veteran, then eligibility for the Veterans Aid & Attendance benefit is not subject ...
However, the most prominent benefit to using an irrevocable trust to hold assets to achieve Veterans Benefits eligibility is control. For VA Aid & Attendance benefits, current VA rules do not impose a waiting period before you can access the benefit because you have transferred assets out of your ownership.
As with any complex area of life and law, pre-planning is key. An informed client and an experienced elder law attorney are both crucial to the proper planning of yours’ or a loved one’s long-term care needs.
With assets protected in the irrevocable trust, future Medi-Cal eligibility may be as simple as merely filing an application. Furthermore, despite any law changes that occur making asset protection planning stricter, these should not affect you.
Some of the more common and relevant powers given to a trust protector in a trust drafted for VA benefits planning may include the following: Remove or appoint a trustee; Amend the trust to comply with the Grantor’s intentions or changes in the law which compromise the trust purpose;
VA pension, also known as non-service connect pension, is a benefit paid to wartime veterans and certain dependents who qualify. This benefit is a means-based program which has the following five basic requirements: (1) 1.
A non-grantor trust causes all items of income and deductions to be borne by the trust to the or by the trust beneficiaries to the extent that income has been distributed to the beneficiaries from the trust. The distinction of a grantor vs. non-grantor trust in the context of VA pension planning is significant.
1. The veteran must be age 65 or older, or permanently and totally disabled, not due to the veteran’s own willful misconduct. Note that there is no age requirement for a surviving spouse to qualify for widow’s pension; 2. The veteran must have been discharged from service under conditions other than dishonorable;
The use of irrevocable trusts has become a popular tool among some practitioners in assisting clients in planning for VA pension benefits. While trusts have become a popular tool, there are many landmines and pitfalls in using irrevocable trusts when it comes to VA pension planning. In part, this is because there is very little guidance ...
Thus, only the portion of the trust property, including trust-related income, that has actually been made available for the veteran's use, is, at the time of its allocation, countable for purposes of the income and net-worth provisions in determining pension benefits.
Thus, under this logic, a claimant can transfer assets to an individual or trust. If the income is gifted back to the veteran-claimant (either from the individual transferee or the beneficiary of trust income), a divestiture has still occurred and the income will be attributed to the veteran-claimant.
The VA Office of General Counsel (OGC) has published several formal Opinions concerning what types of trust language causes the trust assets and income to be included in net worth and income calculations for VA Pension benefits.
Since 1997, it has been the opinion of the OGC generally that “Special Needs” trusts which allow for trust funds to be paid for the health and maintenance of the Claimant are included in the Claimant’s net worth and income calculations.
The BVA used the trustee’s/daughter’s unartful statement and the language of the trust document to affirm the VA’s original denial. The VA updated its manual’s section on assets to address trusts, specifically, for the first time. There is no new law or regulation on trusts implemented, in the new manual entry.
CFEVR does no financial planning or drafting of trusts. We do however review trusts as part of our pre-filing consultation in order to opine on whether the trust will potentially affect a client’s eligibility for benefits. CFEVR’s experience lies solely in examining these documents. The issue of the impact of trusts on eligibility ...
Most importantly, nothing substantive has changed. Existence of a trust may or may not cause a potential VA claimant to be ineligible for benefits. It is one of many factors that must be examined when assessing eligibility for VA benefits.
However, using an irrevocable trust can be one of those situations where the “cure” is sometimes worse than the disease. Here are five reasons to tread carefully when considering transferring assets to an irrevocable trust for long-term care protection purposes.
For many married couples, it is far better not to transfer assets to an irrevocable trust so that if one spouse does need long-term nursing home care, the spouse at home can take full advantage of the laws that offer financial protections to the community spouse.
When the grantor dies, the trust is divided into shares for named individuals or for the grantor's descendants. In the case of the latter, division of the distribution is based on the descendant distribution option that was selected when the trust was first established.
In a Grantor Trust, the Grantor typically acts as the trustee, and he or she retains control of the trust. He or she can appoint and change trust beneficiaries, and decide who receives income. Income from the trust is included in the income of the trust owner, rather than the trust or any other person.
Because this trust can be used in the Medicaid environment, it is important to remember that it is subject to Medicaid’s five-year lookback period. That means your client must create the trust, transfer the assets to fund the trust, and then not require Medicaid benefits for at least five years.
The Medicaid Family Protection Trust. The Medicaid Family Protection Trust is another of the possible strategies that comes up in elder law Medicaid planning. It’s typically suited to clients interested in protecting their own assets and those of their children or beneficiaries from falling into unintended hands.
Grantor and Nongrantor Trusts. Grantor and Nongrantor trusts can be confounding for elder law attorneys, particularly new or transitioning attorneys. Essentially, these aren’t really trusts at all, but rather, tax concepts. Therefore, the focus is on how assets are taxed vs. who receives income or assets.
The Parental Protection Trust. The Parental Protection Trust is another option for adding a niche to estate planning services your firm can offer. It provides an alternative to traditional irrevocable asset protection trust planning and enables your clients to divest of assets and give them to their children.
A Qualified Disability Trust can be one of several beneficial legal strategies for special needs planning within your elder law practice. In order to determine if this type of trust is right for your client you must look at his or her entire case, consider statutory qualification rules, cost considerations and more.