Broker Check

EVENING / WEEKEND - APPOINTMENTS AVAILABLE

Contact Us Today - (888) 532-7429
West Financial Group, Inc. Facebook   West Financial Group, Inc. Twitter   West Financial Group, Inc. LinkedIn   West Financial Group, Inc. YouTube   West Financial Group, Inc. Google+   West Financial Group, Inc. Medium

Funeral Trusts

DO NOT PRE-PAY, INVEST OR MAKE ANY FINANCIAL ARRANGEMENTS OR FINANCIAL TRANSACTIONS THROUGH ANY FUNERAL HOME OR ANY FUNERAL DIRECTOR.

NEVER LEAVE A FUNERAL HOME AS THE BENEFICIARY OF ANY LIFE INSURANCE POLICY

*FOR MEDICAID APPLICANTS*

If you are NOT seeking to qualify for Medicaid or the military Aid and Attendance benefit, purchasing an Irrevocable Funeral Trust is probably NOT the best financial decision. There are other methods of paying for funeral expenses such as Final Expense insurance. This is usually the better solution from a financial perspective. Call us today to discuss your situation.

An Irrevocable Funeral Trust is a trust you create for your final expenses. It is a single premium life insurance policy that is offered by a select group of insurance companies - placed into your 'Trust' for safe-keeping until you pass away. Because the policy itself is owned by your Irrevocable Funeral Trust, it offers tax-free benefits and protection from inflation. Additionally, the Irrevocable Funeral Trust is not included in your assets when applying for Medicaid or admission into a nursing home which is also known as a non-countable asset. Most states limit the value of the funeral trusts to $15,000; assets over that amount may also need to be converted to non-countable assets through other means.

Benefits of an Irrevocable Funeral Trust include:

  • Cannot be confiscated by any nursing home or government sponsored care (Medicaid)
  • Exempt from Medicaid and Supplemental Security Income (SSI) "spend down" requirements and Estate Taxes
  • Protected against inflation
  • No legal fees are required for set up
  • The trust proceeds are portable to any funeral home
  • Avoids probate costs and delays
  • Excess funds are paid to your estate income tax free
  • Does not violate the ¹Asset Transfer Rule
  • Can be used for additional expenses such as:
    • a permanent monument in the cemetery
    • travel expenses for family members to attend your funeral
    • outstanding debts or obligations
    • hospital, doctors, legal or attorney
    • a repast once the services are concluded
    • your final expense monies are guaranteed to be there when you need them

¹ Asset Transfer Rule - in order to qualify for Medicaid you cannot have transferred assets to children (or whomever) within the previous 60 months (also known as the “look-back period”). A penalty is imposed on assets that were transferred without receiving fair value. The penalty is a period of time during which the person who transferred the assets is ineligible for Medicaid.

Continuing to hold a fully paid-up life insurance policy may not be a wise decision…. we have answers!

A fully paid-up life insurance policy with a cash value of more than $1,500.00 is called a countable asset, meaning the Medicaid and nursing home count the amount of cash value over $1500 as part of your total assets. The total amount can be confiscated by Medicaid or a nursing home. Your existing insurance policy can be EXCHANGED - via a process known as a 1035 Exchange – with no reduction or loss of any benefits or earned value - into a new policy that will be placed into, and owned by, your new Irrevocable Funeral Trust. This will keep your funds safe from confiscation by any entity (Nursing home, Doctors, Hospitals, etc).