Irrevocable Trusts

There are different types of trusts, one of which is an irrevocable trust. An irrevocable trust cannot be revoked or terminated by its creator without court intervention. 

There are two main types of irrevocable trusts:

• Those where the assets held in the trust benefit the creator of the trust.
• Those where the assets are for the benefit of another person or persons.

Irrevocable trusts, designed for asset protection, offer the ability to safeguard resources. In such cases, the creator of the trust typically cannot have full control over the assets or must have limited control. Therefore, the most commonly used type of irrevocable trust is the one where the assets are held for the benefit of another person, ensuring a secure future for the assets.

When assets are transferred to an irrevocable trust for the benefit of another person, the original owner no longer has control or ownership of the assets, effectively making it a gift of the assets away from the owner.

Irrevocable Medicaid Asset Protection Trust

Growing in popularity, an Irrevocable Medicaid Asset Protection Trust transfers assets away from the owner to have them protected in trust. This can assist a person in qualifying for Medicaid five (5) years in the future to pay for nursing home care. 

In Missouri, Medicaid has been renamed MO HealthNet, and the program that helps pay for nursing home care is called Vendor MO HealthNet. 

Veterans Administration’s Aid and Attendance

Similarly, an irrevocable trust is used to hold assets to qualify a person for the Veterans Administration’s Aid and Attendance pension benefit. In these situations, irrevocable trusts can be very helpful, providing a practical and effective solution. 

Special Needs Trusts

Additionally, special needs trusts are irrevocable trusts. They are of the type where the resources benefit the special needs or disabled person. These can either be set up by the special needs person or another party may establish the trust.