April 28, 2026 - Volume 7 Issue 441

TRADING UP WITHIN A TRUST…read on:

CLIENT QUESTION:

If you sell a house owned by a Medicaid trust for $500,000 and buy a new one for $600,000, does that trigger a new 5-year lookback?

MY RESPONSE:

NO, assuming no new money was transferred into the trust. Look-backs are only triggered when new money is transferred from the grantor into the trust, not a reinvestment of money already in the trust.  



However, if the grantor added another $100,000 to the trust to buy the more expensive house, this is where new look-backs and problems begin.  

The bottom line, if you are looking to upgrade your property within your trust, talk to us first.

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