Miller Trust: A Comprehensive Guide to Its Legal Definition and Use
Definition & Meaning
A Miller Trust, also known as a Qualifying Income Trust (QIT), is a financial arrangement that allows individuals to qualify for Medicaid benefits while maintaining certain income levels. This trust makes income from Social Security and other sources exempt from Medicaid calculations. In this setup, the applicant assigns their non-exempt income to an irrevocable trust, which then distributes the maximum allowable amount to the applicant. The remaining income stays in the trust, which is used to cover Medicaid expenses after the recipient's death.
Legal Use & context
Miller Trusts are primarily used in the context of Medicaid planning and elder law. They are relevant for individuals seeking long-term care assistance while ensuring they do not exceed income limits set by Medicaid. Legal practitioners often help clients set up these trusts to navigate the complexities of Medicaid eligibility. Users can manage some aspects of this process themselves with the right legal templates, such as those available through US Legal Forms.
Real-world examples
Here are a couple of examples of abatement:
Example 1: A person receiving $2,000 per month in Social Security income may set up a Miller Trust, assigning their income to the trust. The trust pays the nursing home $1,500, which is the maximum allowable amount for Medicaid eligibility, while the remaining $500 stays in the trust.
Example 2: An elderly individual with a monthly income of $3,000 could use a Miller Trust to qualify for Medicaid by ensuring that only the allowable amount is paid out, thus maintaining eligibility for necessary long-term care (hypothetical example).