Instructions for QIT Trustees
A Qualifying Income Trust ("QIT") should never contain anything except the Beneficiary's ("B's") income. Do not ever allow money that belongs to anyone else to be placed in the account, and do not allow B to deposit anything except current income to the trust account (no savings).
1. FILL IN THE QIT FORM. Fill in the blanks according to the instructions with the form. You have a choice as to how much of B's income to put into the trust: You can put all of the monthly income into the account, or only the amount that is over $2022 (2009 amount).
2. SIGN THE TRUST DOCUMENT: If B is no longer able to execute legal documents, B's Guardian or Attorney in Fact (person holding Power of Attorney) may sign. In that case, you will need to attach to the trust document a copy of the Guardianship order or the POA papers.
3. HAVE THE TRUST DOCUMENT NOTARIZED.
4. MAKE THREE COMPLETE COPIES: one for the medicaid office, one for the bank, and one for yourself.
5. OPEN A CHECKING ACCOUNT. The account should be named "The [B's name] Qualifying Income Trust" and have B's social security number. Only the Trustee, and not B, should have power to withdraw from or write checks on the account. It is not necessary to obtain a tax number for the trust. The social security number of the beneficiary shouldbe used on the account.
6. TAKE OR SEND THE TRUST DOCUMENT TO YOUR LOCAL COMMUNITY-BASED SERVICES (MEDICAID) OFFICE.There may be a waiting period before the trust is officially approved. (In the meantime, the Trustee should make payments from the trust account as set out in the trust document.)
7. DEPOSIT B'S INCOME INTO THE ACCOUNT AS SOON AS B RECEIVES IT. You must transfer income to the trust in the same month that it comes to B or is deposited directly into B's other account. Never allow any deposit to the trust from funds B received before the current month.
8. FROM THE ACCOUNT PAY ONLY THE BILLS WHICH MEDICAID HAS APPROVED.The trust states that the following monthly expenses are approved, and should be paid from the trust to the extent there is money:
- B's personal needs allowance ($40 if B is in a nursing home; $694 (2009 amount) if B is receiving home or community based care);
- The allowance for B's spouse or dependent children, if any. (The Medicaid worker will set the amount);
- All unreimbursed medical expenses which are of a type allowed by Medicaid, such as the Medicare Part B premium, if any (usually this has already been deducted from the Social Security check), and medical insurance premiums, but not life insurance premiums.
- B's share of the nursing home bill, called the "Patient Liability" amount or "Applied Income." (If B has non-trust income, that Income will also need to be paid to the nursing home.)
If B has medical or personal needs that are not covered by Medicaid (such as eyeglasses, dentures, hearing aids, etc.) and you would like to cover the expense out of the trust funds, you must make a special written request to B's case worker.
9. MAKE A RECORD OF ALL CHECKS WRITTEN. Record check number, date, payee, purpose and amount.
10. KEEP CANCELED CHECKS AND ALL QIT RECORDS. You will need to provide the Beneficiary with a yearly record of all trust income and checks written. B will need this record to prepare B's individual income tax return. The trust will not have to file a tax return.
Reviewed August 2009