Veterans Asset Protection Trusts
Veterans have spent their lives protecting our country and keeping its citizens safe. They often need assistance in protecting their assets later in life in order to safeguard their families’ futures. Estate planning for veterans can utilize various instruments, including traditional living wills or powers of attorney as well as specialized tools such as Veterans Asset Protection Trusts, or VAPTs. Eligible veterans may establish these trusts in order to protect their assets during the course of their lifetimes, as well as to benefit a surviving spouse. Making sure that the proper measures are taken to execute these trusts is important to take advantage of their purpose. The Nashville estate planning lawyers at Martin Heller Potempa & Sheppard, PLLC assist veterans in establishing estate plans that serve their best interests, as well as those of their families. Our firm represents clients in all types of estate matters, offering knowledgeable and compassionate legal advice for people who need assistance planning their future. If you have any questions related to setting up a VAPT or want to find out more about your legal options, including which estate plan might be best for you, contact our office today to learn more about our legal services.Establishing Veterans Asset Protection Trusts
A VAPT is an irrevocable trust set up by an eligible veteran that allows the assets contained in it special status when it comes to income tax purposes, and therefore it does not affect benefits provided by the Department of Veteran Affairs (VA). For instance, a veteran’s residence may be placed in a VAPT before they apply for VA benefits. It thus becomes a “non-countable resource” and is not part of the veteran’s net worth when applying for VA benefits. By protecting a veteran’s assets from being calculated as part of their resources, VAPTs also allow certain tax advantages as well as ensuring that veterans get necessary benefits for medical care.
In order to establish a VAPT correctly, the veteran must be the grantor of the trust, but they may not be named as the beneficiary. Beneficiaries are usually the grantor-veteran’s spouse or children, since they must be someone living in the grantor’s household. The trust must also appoint a trustee, who is able to make distributions to beneficiaries at their discretion. The grantor cannot be taxed on any income in the trust for it to be valid, nor can the grantor be able to receive income from trust assets.
A veteran may rely not only on VA benefits but also on those provided by Medicaid, known as TennCare in Tennessee. In these instances, an attorney can help set up a Qualified Income Trust or Miller Trust, which is comprised of the veteran’s monthly income, the assets of which do not get calculated for the purposes of the income cap limit. Some veterans need Medicaid benefits for nursing home care. They may need both VA and Medicaid assistance, or they may seek one in lieu of the other. Because of the detailed requirements to ensure that VAPTs are executed properly and coordinate with other estate planning instruments, it is important to consult an experienced estate attorney who can guide you through the procedures.Contact a Trusts and Estates Attorney in Nashville or Elsewhere in Tennessee
If you need VA or Medicaid benefits, the estate planning process can be complicated and sometimes challenging. The Nashville lawyers at Martin Heller Potempa & Sheppard, PLLC can help you determine which instruments are appropriate to protect yourself, as well as your family. We have vast experience establishing all types of trusts and wills, and we are dedicated to making sure that veterans’ futures are preserved. Our firm represents clients across Williamson and Davidson Counties, including in Nashville, Franklin, East Nashville, Hillsboro Village, and Brentwood. If you need legal assistance with setting up a VAPT, or with any other estate planning issue, contact our office today online or at 615-800-7096 to see how we can assist you.