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Old 11-18-2017, 04:50 PM   #61
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Originally Posted by tinlizzy View Post
Maybe they set up the trust to ensure their children had to care for them in a home setting?
Well since it's out of the parents hands, what they really did was set it up so the children can abandon the parents under some bridge as nothing will stop the children from benefiting from the trust.
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Raiding my retirement to help parent to CCRC??
Old 11-18-2017, 05:46 PM   #62
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Raiding my retirement to help parent to CCRC??

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Originally Posted by Sunset View Post
Well since it's out of the parents hands, what they really did was set it up so the children can abandon the parents under some bridge as nothing will stop the children from benefiting from the trust.


I got that from reading the thread. I wasn't knocking the kids but rather pointing out that some people find the thought of nursing homes so distasteful they might have thought this was a foolproof plan to avoid one.

My aunt and uncle set up a trust for their estate and my four cousins will only inherit when they each turn 68. Not one word about the trust when they were alive - total surprise.

People do screwy things.
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Old 11-18-2017, 06:27 PM   #63
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I doubt it is that easy. The trust is an entity. I would expect it has its own tax number and files taxes. The parents are a beneficiary, not the owner. They really have no say in what happens with the trust. I think you need to go to court to break/dissolve the trust. This is usually AFAIK is because the trust can't fulfill it's purpose.

You're probably right that no interested party would object if the trustee violated the trust terms and just paid for the parent's LTC. But all risk would be on him.
One would also need to look at tax consequences. This is not like a revocable trust where the owner can pull assets out because they are owned by them.

Now the question could the trust create earning so they had to be distributed? That could make cash flow unless the trust also says it can't be used for LTC.
My MIL set up an irrevocable trust, managed by my wife as trustee, primarily for the benefit of my BIL who has MS and is an assisted living facility. The trust was also set up to enable MIL to get VA Aid and Attendance benefits but those plans went awry when she passed away before we could file the VA application -- we blew away the idea of her getting Medicaid benefits -- she was in assisted living facility when she passed away and if she ever needed skilled nursing care -- my wife and I were going to pay for those medical expenses minus any pension and social security income available to MIL.

MIL's trust is a non-grantor trust that has it's own tax EIN. We will soon be filing our first tax return for the Trust. In reading this thread, I'm surprised that the OP has not mentioned any tax filings or trust distributions. No trust distributions? Is trust income retained by the trust? And how are the trust assets invested?

Sounds like the OP's parents might have set up something they (or other family members) didn't fully understand. If the OP's sibling is the trustee, then I hope she has a good grip on how this trust is supposed to operate, but if it's a non-grantor trust (which means the grantors cannot benefit from the trust), then I hope there is an alternative source of resources and income to help OP's parents get into CCRC or an assisted living facility -- this might be something to discuss with the Trustee, if she has complete discretion over trust distributions.
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Old 11-28-2017, 10:30 PM   #64
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albireo13, any update? What happened?
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Old 11-30-2017, 06:15 PM   #65
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So, latest update ...
we've inquired with several lawyers and have embarked on dissolving the trust. Apparently it is not too difficult if all parties involved agree and sign for it. Anyway, I hope it can be completed within a few weeks.

At that point the assets will all be available for my parents to use for their care.
It may be possible to re-establish a trust after they have gotten into the CCCRC .... TBD.

Anyway, a great learning experience. Not out opf the woods yet but, there seems to be a plan now.

I'll update as things progress. Thanks to all.
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Old 11-30-2017, 06:19 PM   #66
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So will your parents miss out on the CCRC slot that was being held for them or will they hold it open for them while this all ts sorted out?
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