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Income Cap Trust

What is an Income Cap Trust?

An income cap trust is a medicaid planning device that allows someone who makes too much income to receive medicaid benefits, but too little to pay for their own care, qualify for medicaid. In Oregon, you can have $2,199 a month or less and still qualify for long term care under medicaid. If your monthly income exceeds that dollar amount, you will be over resource and not qualify for medicaid.

In order to allow a person to qualify for medicaid, an income cap trust can be established that will reduce the monthly income to the cap level or below. An income cap trust is a special type of trust that, when established, redirects an individuals income to the trust. The trustee may release funds to the medicaid recipient for specific reasons and at a specific dollar amount every month. Any money that accumulates in the trust will be paid to medicaid after the passing of the medicaid recipient.