For many Ohio families, estate planning focuses on the transfer of assets from one generation to the next with provisions put into place for a surviving spouse. It is difficult to plan for every possible set of circumstances that might arise, but families should strive to cover as many bases as possible in their approach. For example, couples should think about the impact that their estate plan would have if a surviving spouse should require residential nursing care following his or her partner’s death.
Many families rely on Medicaid to help cover the cost of residential care needs. It is important to understand, however, that Medicaid coverage only becomes effective after a family or individual has depleted the majority of their own assets. This can cause a problem for couples who fail to take the steps required to shield assets from inclusion in the Medicaid formula.
When a surviving spouse inherits the bulk of the family’s assets, he or she usually does so with the intent to pass on a significant portion to children and grandchildren. However, if the need should arise for residential care, those assets would have to be placed toward the cost of that care before Medicaid would provide assistance. In the end, very little might be left to pass down to loved ones.
Creating an irrevocable trust is a good fit for Ohio families who want to protect assets for the purpose of inheritance. Assets can be placed within the trust and loved ones named as beneficiaries. In this way, the intended heirs can have access to the wealth held within the trust while the surviving spouse is still able to qualify for Medicaid coverage. This is one way that spouses can continue looking after one another after death, just as they had during their lives together.