An Income Only Trust allows an individual applying for ALTCS to meet the income requirements, when they otherwise have too much income to qualify.  An individual applying for ALTCS benefits must meet certain income requirements in order to qualify for benefits, in addition to meeting other eligibility criteria.  A single person must not have more than $2,250.00 gross monthly income in order to qualify for ALTCS. A married applicant will meet the income eligibility requirement if the total income of both spouses does not exceed $4,500.00 gross per month; or if the total income received by the applicant under his name does not exceed $2,250.00 gross per month.

If an applicant’s income exceeds $2,250.00 a month, but is less than the private pay rate established in the applicant’s residential geographic area in Arizona ($7,134.44 a month if they live in Maricopa, Pima, or Pinal county, or $6,307.44 a month if they live in any other county), he/she can use an “Income-Only Trust” (also known as a “Miller Trust”) to “fix” the income problem and meet income criteria. The Income Only Trust is a separate trust agreement that must be established in accordance with 42 U.S.C. 1396p(d)(4)(B).

If an individual’s income exceeds the gross monthly income limits, the individual will require the assistance of an attorney to prepare and establish and Income Only Trust in order to qualify for ALTCS benefits.  The ALTCS Manual lays out specific rules for how the income assigned to the Income Only Trust must be distributed from the Trust on a monthly basis.  It is critical that the Income Only Trust be administered in accordance with ALTCS rules, otherwise the applicant still may not be eligible for ALTCS benefits.

If your income exceeds the gross monthly income limits, call us to consult with one of our experienced elder law attorneys to discuss the establishment and administration of an Income Only Trust to meet ALTCS income eligibility criteria.

-Megan Selvey, Esq.