What are the benefits of putting a house in trust?
What are the benefits of putting a house in trust, like a revocable trust, in terms of home ownership? Would this type of trust "protect" this asset should the parent enter a nursing home?
For most people, the single biggest advantage to placing a home in such a trust occurs after they die: It allows their survivors to save the cost and time of putting the property through probate, which is the common court proceeding required to transfer the title to it.
Those who want the property to passes to a spouse may also structure the trust to avoid some estate taxes. And revocable trusts are a good option for those who wish to maintain some flexibility and control over their estate plans, as the trusts may easily be amended or ended at ay time.
Finally, because the terms of a trust are not made public -- unlike wills, which are filed in court after a death and can be perused by those who request a copy -- a trust may be a good estate planning choice for people who prefer to keep their plans for distributing their property private.
A revocable trust will not do anything to "protect" home from consideration by Medicaid in determining eligibility for nursing home coverage. Since the trust is revocable, assets in it, including the home, are still within the control of the person who creates the trust. And since the home remains in that person's control, it's considered to belong to that person for Medicaid purposes.
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