Qualified Income Trust Georgia: How To Set Up A Miller Trust In Georgia

Qualified Income Trust Georgia - Miller Trusts In Georgia - What Is A Miller Trust - What Is A Qualified Income Trust

What is a Qualified Income Trust and Miller Trust in Georgia? 

In this article, you’ll learn about: 

  • what is a QIT and Miller trust
  • eligibility for Medicaid
  • how to set up a QIT or Miller trust
  • how to operate and administer these trusts
  • reporting requirements and compliance with Georgia Medicaid
  • the income limits for Georgia’s Medicaid eligibility
  • how married couples should set things up
  • types of expenses you can use the trusts for

Let’s dig in.

Table of Contents

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Qualified Income Trust & Miller Trusts In Georgia

In Georgia, the terms “Qualified Income Trust” and “Miller Trust” are actually referring to the same type of trust

They are not two distinct concepts, but two names for the same thing. 

This type of trust is used to help individuals qualify for Medicaid when their income is above the allowable limit set by Medicaid.

The name “Miller Trust” comes from the name of the court case that first established this type of trust. 

A “Qualified Income Trust,” on the other hand, is the technical name for this type of trust as described in Medicaid regulations.

The purpose of a QIT or Miller Trust is to hold the portion of a person’s income that exceeds the Medicaid income limit. 

Once this income is placed in the trust, it no longer counts toward the person’s income for Medicaid eligibility purposes. 

However, the money in the trust must be used for specific types of expenses related to the person’s medical and long-term care needs.

Read More: How To Avoid Nursing Home Taking Your House

What Is Qualifying Income?

Qualifying income refers to the income of an individual that is over the Medicaid eligibility limit. 

This excess income is what you place into the QIT or Miller Trust. 

The trust effectively brings the individual’s countable income down to a level where they qualify for Medicaid benefits. 

Qualifying income could include Social Security benefits, pension payments, rental income, or other regular, recurring income sources. 

The income deposited into the trust is typically used to pay for medical and long-term care expenses for the individual. 

After the person’s death, any leftover funds in the trust usually go to the state to repay the cost of Medicaid services provided.

Other Georgia Trust Options

Besides Qualified Income Trusts (QITs) and Miller Trusts, other trust options for Medicaid eligibility in Georgia include:

  • Special Needs Trust (SNT): These trusts are designed for people under 65 with disabilities. They allow individuals to set aside assets for certain expenses without affecting Medicaid eligibility.
  • Pooled Trusts: This is a type of SNT managed by a non-profit organization. Several beneficiaries’ assets are “pooled” together for investment purposes, but individual accounts are maintained for each beneficiary’s needs.
  • Supplemental Needs Trust (also known as a Third-Party Special Needs Trust): These trusts are funded by someone other than the beneficiary, often parents or other family members, for a person with disabilities. Assets in the trust are not counted for Medicaid eligibility.
  • Irrevocable Trusts: Once assets are transferred into an irrevocable trust, they usually cannot be removed or controlled by the person who created the trust. The assets within an irrevocable trust typically aren’t counted as part of personal assets when considering Medicaid eligibility.

Read More: Georgia Incapacity Planning Lawyers

Using A QIT Or Miller Trust For Georgia Medicaid Eligibility

In this section, we will talk about:

  • the income limits for Georgia’s Medicaid eligibility
  • how married couples should set things up
  • types of expenses you can use the trusts for

Income Limits For Georgia Medicaid Eligibility

The following table provides the income limits for Georgia’s Medicaid eligibility

Type of MedicaidMarital StatusIncome LimitAsset Limit
Institutional / Nursing Home MedicaidSingle$2,742 / month$2,000
Married (both spouses applying)$5,482 / month ($2,742 / month per spouse)$3,000
Married (one spouse applying)$2,742 / month for applicant$2,000 for applicant & $148,620 for non-applicant
Medicaid Waivers / Home and Community Based ServicesSingle$2,742 / month2,000
Married (both spouses applying)$5,482 / month ($2,742 / month per spouse)3,000
Married (one spouse applying)$2,742 / month for applicant$2,000 for applicant & $148,620 for non-applicant
Regular Medicaid / Aged Blind and DisabledSingle$914 / month2,000
Married (both spouses applying)$1,371 / month3,000
Married (one spouse applying)$1,371 / month3,000

Let’s say your income exceeds the income limits set by Georgia’s Medicaid program.

You can set up a Qualified Income Trust (QIT), also known as a Miller Trust, to help you qualify for Medicaid. 

Here’s a simplified explanation of how it works:

  1. Set Up The QIT: The trust must be set up correctly according to Georgia’s laws. This usually requires legal assistance.
  2. Deposit Excess Income: Each month, you deposit the portion of your income that exceeds the Medicaid limit into the QIT.
  3. Income Disbursement: The income in the QIT can then be used for specific expenses, such as medical and long-term care costs, a personal needs allowance, and possibly a community spouse allowance.
  4. Medicaid Eligibility: Once your excess income is in the QIT, it does not count towards your monthly income for Medicaid eligibility. This could allow you to become eligible for Medicaid even though your actual income is above the limit.
  5. Reimbursement To State: After your death, any remaining income in the trust typically goes to the state to repay the cost of Medicaid services provided to you.

Please note that this is a general process. 

Your individual circumstances can affect how a QIT should be set up and managed. 

It is important to get help from a trust lawyer who understands:

  • Georgia’s laws 
  • Medicaid regulations

This will ensure the QIT is set up and used correctly per Georgia’s laws.

Read More: At What Net Worth Do I Need A Trust?

Married Couples Using A Qualified Income Trust

Does each applicant need to have a separate QIT, or can they use the same one? 

Each applicant needs to have a separate Qualified Income Trust (QIT). 

This is because the trust is:

  • set up in the individual applicant’s name
  • meant to handle that specific individual’s income

So, if there are two applicants (for instance, a married couple), each needing to qualify for Medicaid, each person would have to set up their own separate QIT. 

Their income cannot be mixed in a single trust because Medicaid considers income eligibility on an individual basis, even for married couples.

Read More: How Much Do Trusts Cost?

Types Of Expenses The QIT Money Can Get Used For

The funds in a Qualified Income Trust (QIT), or Miller Trust, can be used for specific types of expenses. 

Here are some typical uses of the money in these trusts:

  • Patient’s Portion of Cost: This is the share of the cost for the Medicaid recipient’s long-term care or medical services.
  • Personal Needs Allowance: This is a small amount of money that can be set aside each month for the Medicaid recipient’s personal needs, like toiletries or clothing.
  • Community Spouse Income Allowance: If the Medicaid recipient is married, an allowance may be set aside for the spouse still living in the community. This allowance is intended to prevent the spouse from becoming impoverished.
  • Health Insurance Premiums: This can include premiums for Medicare and other types of health insurance.
  • Funeral Expenses: Some states allow a small amount of money to be set aside for funeral or burial expenses.
  • Reimbursement to Medicaid: After the death of the Medicaid recipient, the state is usually the first entity to be paid back from the trust for the cost of Medicaid services provided.

Read More: Can I Set Up A Trust Without My Spouse?

Qualified Income Trusts And Miller Trusts In Georgia

Let’s talk about the ins and outs of QIT and Miller Trusts in Georgia. 

In this section, you’ll learn about:

  • what is a QIT and Miller trust
  • eligibility for Medicaid
  • how to set up a QIT or Miller trust
  • how to operate and administer these trusts
  • reporting requirements and compliance with Georgia Medicaid

Read More: Who Owns The Property In An Irrevocable Trust

What Is A QIT And Miller Trust?

A Qualified Income Trust (QIT) is a type of trust for Medicaid eligibility. 

When an individual’s income exceeds Medicaid’s limit, the extra income goes into the QIT. 

This lowers the individual’s income on paper, making them eligible for Medicaid.

In a QIT, a trustee is appointed. 

The trustee manages the funds, paying for the Medicaid recipient’s personal and medical needs.

QITs only hold income like wages or Social Security benefits, not assets such as property or investments. 

Money going into a QIT must be spent within the same month. 

This ensures the trust balance remains zero at the end of each month.

While QITs can help people qualify for Medicaid, they also have drawbacks. 

The state can claim the remaining funds after the Medicaid recipient’s death. 

This can limit the inheritance left for the family.

Read More: What Happens To An Irrevocable Trust When The Grantor Dies?

Eligibility For Qualified Income Trusts In Georgia

To use a QIT in Georgia, your monthly income must be over the Medicaid limit. 

Income sources can be Social Security, pensions, and rental income. 

Your income cannot be too high, though. 

If it’s above the private cost of care, you won’t qualify.

You don’t have to put all your income in the QIT. 

Only the amount over the limit goes in.

The QIT must be irrevocable, meaning once you set it up, you can’t cancel it. 

But, if your income drops below the limit, the QIT can end.

Money in the QIT goes toward your healthcare costs. 

It can pay your share of the Medicaid costs and personal needs allowance.

Any money left in the QIT when you die will pay back the state for Medicaid benefits received. 

If there’s still money left, it goes to your named beneficiaries.

In Georgia, you must set up the QIT correctly and follow the rules. 

Otherwise, it can disqualify you from Medicaid. 

You also must report it to Georgia’s Medicaid office.

Read More: Do I Need A Trust To Avoid Probate

Setting Up A Georgia QIT Or Miller Trust

Setting up a Qualified Income Trust (QIT), also known as a Miller Trust, in Georgia involves several key steps:

  • Identify Trustee: Determine who will manage the trust. This can be you, a family member, or a trusted friend.
  • Create the Trust: Prepare a QIT document following Georgia’s legal requirements. This must include the name of the trustee, beneficiary, and the purpose of the trust.
  • Notarize and Sign: Once the trust document is complete, it needs to be signed by the trustee and notarized.
  • Open Trust Bank Account: Open a bank account in the name of the trust. All of the beneficiary’s income must be directly deposited into this account.
  • Transfer Income: Direct all income from the beneficiary to the trust bank account. This includes Social Security benefits, pensions, and any other form of income.
  • Pay Personal Allowance: From the trust account, pay the beneficiary’s personal needs allowance. This is a set amount allowed by Georgia for the beneficiary’s personal expenses.
  • Pay Healthcare Costs: After the personal needs allowance is paid, healthcare and medical costs are paid. This includes any insurance premiums or medical costs not covered by Medicaid.
  • Pay to Medicaid: Any remaining income in the trust bank account is typically paid to the Medicaid program.
  • Maintain Records: Keep meticulous records of all transactions related to the trust.
  • Annual Reporting: Submit any required annual reports or accountings to the necessary parties. This may include Medicaid or a court, depending on the circumstances.

Read More: How To Put House In Trust With Mortgage

QIT Operation and Administration

Here is an overview of the basic operations of a QIT in Georgia:

  • You establish a Miller Trust by setting up a separate bank account in the trust’s name.
  • Once the trust is created, most or all of the person’s income is deposited directly into this account.
  • The person who manages this account is called the trustee. The trustee could be a family member, friend, or professional.
  • The trustee’s role is to manage the funds in the trust. They ensure that the money is used appropriately to meet the beneficiary’s needs and to comply with the rules of the Medicaid program.
  • Each month, the trustee uses the funds in the trust to pay for the beneficiary’s personal needs allowance, which can cover costs like clothing and personal items.
  • The trustee may also pay for health insurance premiums and other medical costs that aren’t covered by Medicaid.
  • The remaining money in the trust typically goes to the cost of the beneficiary’s care.
  • Any income left in the trust after these payments is considered as part of the person’s share of the cost of their care.
  • At the end of the month, there should be a small or zero balance left in the trust.
  • When the person who benefits from the trust dies, any money left in the trust is used to repay the state for the Medicaid services received.

Read More: Tax Implications Of Transferring Property Into A Trust

Reporting Requirements And Compliance

Here are the reporting and compliance requirements for a Miller Trust in Georgia:

  • Income Reporting: You must report all income that goes into a Miller Trust or QIT. This includes wages, Social Security benefits, pensions, and any other form of income.
  • Changes in Circumstances: You must report any changes in circumstances that could affect the trust. This includes changes in income, eligibility for benefits, or health status.
  • Compliance with Medicaid: A Miller Trust or QIT must follow Medicaid rules. You can only use the income in the trust to pay for approved expenses. These can include health care costs, personal needs, and in some cases, family allowances.
  • Penalties for Non-Compliance: If you do not follow Medicaid rules, there can be penalties. This could include loss of Medicaid benefits. In serious cases, you could face legal action.
  • Monthly Reporting: Some states require monthly reporting to ensure compliance. This involves showing how you used the trust income.
  • Proper Documentation: Always keep accurate records of all transactions involving the trust. This helps prove you are following the rules.
  • Annual Review: There may be an annual review of your Miller Trust or QIT. This is to ensure it still meets Medicaid eligibility requirements.
  • Trustee’s Role: The trustee manages the trust and ensures all rules are followed. They play a key role in avoiding penalties.

Read More: What Happens To A House In A Trust After Death?

Advantages And Limitations Of QITs And Miller Trusts

Let’s talk about the benefits and disadvantages of these trusts.

Advantages Of QITs And Miller Trusts

Here are the core advantages of a QIT and Miller Trust:

  • Income Limit Overcome: These trusts help those whose income is over the Medicaid limit. The excess income goes into the trust and is not counted.
  • Nursing Home Costs: QITs and Miller Trusts allow seniors to afford nursing home care. This is crucial for people who can’t pay out-of-pocket.
  • Personal Needs: Some money from the trust can be used for personal needs. This improves the beneficiary’s quality of life.
  • Spouse Support: If the beneficiary has a spouse, some income can go to them. This helps protect the spouse from financial hardship.
  • Estate Planning: These trusts can be part of a larger estate plan. This is useful for protecting assets and planning for the future.
  • Avoiding Spend Down: QITs and Miller Trusts prevent the need to spend down assets. This can preserve resources for the beneficiary and their family.
  • Legal and Safe: Using these trusts is a legal way to qualify for Medicaid. It ensures compliance with state and federal laws.

Read More: What Assets Cannot Be Placed In A Trust?

Limitations Of QITs And Miller Trusts

Here are the limitations of a QIT and Miller Trust:

  • Only income can go into the trust: You can only put your income, like Social Security or pension checks, into the QIT. You cannot put assets, like your home or savings.
  • Income must be used for your care: Every month, the income in the trust must be used to pay for your care expenses. This includes your Medicaid share of cost, personal needs allowance, and spouse’s allowance.
  • The state gets what’s left when you die: After you die, any money left in the trust goes to the state, up to the amount the state paid for your care.
  • You can’t control the trust: You can’t make decisions about how the money in the trust is used or invested. The trustee, who is not you, controls the trust.
  • The trust must be irrevocable: Once you set up the trust, you can’t cancel it or change it without a court order.
  • The trust ends when you die: The trust doesn’t continue after your death. After paying any remaining bills and repaying the state, the trust ends.
  • You need to follow strict rules: You must follow all the rules about setting up and using the trust. If you don’t, you could lose your Medicaid eligibility.

Read More: How To Put A House In A Trust

How Much Does It Cost To Set Up A Miller Trust?

Here is how much a Miller Trust costs based on the complexity of your Miller Trust:

  • DIY Trust: $50 – $350
  • Simple Trust: $1,000 – $3,000
  • Complex Trust: $5,000+

If you opt for a do-it-yourself (DIY) Miller Trust, you might only spend between $50 and $350.

If you decide to hire a trust lawyer in Georgia, the cost can range from $1,000 to $3,000 for a single person’s trust. 

This fee typically includes:

  • the initial consultation
  • trust drafting
  • signing process

If your estate is complex, requiring unique provisions or tax planning, costs can go up to $5,000 or more. 

Remember, additional costs might occur, such as funding your trust or amending it in the future. 

Also, the trust administration after your death can incur separate expenses.

FAQs About Qualified Income Trusts and Miller Trusts In Georgia

Here are the most common questions our clients ask us about this type of trust. 

Does A Qualified Income Trust File A Tax Return?

No, a Qualified Income Trust does not file a tax return.

From a tax perspective, a Qualified Income Trust itself does not typically file a separate tax return. 

Instead, the income earned by the trust is generally attributed to the beneficiary for tax purposes. 

The beneficiary includes the trust’s income on their personal income tax return and is responsible for paying any applicable taxes.

What Expenses Can Be Paid From A Miller Trust?

A Miller Trust in Georgia can be used to pay for long-term care expenses. 

These expenses may include:

  • nursing home costs
  • home care services
  • medical bills
  • other related expenses 

The trust allows individuals with high income to qualify for Medicaid while using their excess income to cover these expenses. 

It is important to follow the guidelines and regulations set by the state when establishing and using a Miller Trust.

Is A Miller Trust Irrevocable?

Yes, a Miller Trust is irrevocable.

Get A Qualified Income Trust

If you want help from a trust law firm, fill out the form below. 

At The Hive Law, we understand the importance of:

  • protecting your hard-earned assets 
  • ensuring your family’s future
  • not losing everything to Medicaid
  • being eligible for Medicaid

We only accommodate a limited number of clients each month.

So don’t miss your opportunity to work with our trust fund lawyers.

Benefits of our trust services:

  • Tailored solutions to fit your unique needs and goals
  • Expert guidance in navigating complex tax and legal matters
  • Preservation of your wealth for future generations
  • Streamlined asset distribution according to your wishes

Avoid the pitfalls of inadequate estate planning strategies:

  • Creditors seizing your assets
  • Lawsuits jeopardizing your family’s financial security
  • Family disputes over inheritance
  • Costly and time-consuming probate processes

Talk soon.

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