Irrevocable Funeral Agreement

The Internal Revenue Service defines a funeral fund as a “pooled income fund” created by a funeral home or cemetery to which a person transfers property to cover future funeral and funeral expenses.¬†They are often referred to as “pre-born programs.” [1] ISS-related RS/As who are authorized to spend excess resources must be given ten days from the date they are informed of an amount of excess resources in order to reduce the excess resources by entering into an irrevocable funeral contract and/or funeral fund. Only amounts used for the purchase of an irrevocable funeral contract and/or funeral fund for the applicant and the applicant`s spouse may be used with retroactive effect to the month of application and the retroactive three-month period, in order to reduce excess resources. The ten-day period may be extended if more time is required. Compensation for excess resources resulting from these funeral negligence is permitted as if they were purchased during the retroactive period (see LDSS-4321, “Explanation of the Surplus Resources Program” attached). ISS-related A/Rs who do not have an irrevocable funeral agreement before need or who have provided less than $1500 for non-funeral items in a funeral agreement before need may be allowed to ignore the additional funds by creating an additional funeral fund. If the A/R spouse does not have an irrevocable funeral agreement before need or has a pre-need funeral agreement, which contains less than US$1500 for non-funeral items, the R/A may also create an additional funeral fund for their spouse. An additional funeral fund must be able to be identified separately with a maximum initial value of USD 1,500 (USD 3,000 for a pair) or more, if ordered by the courts. Released funeral funds may not be mixed with non-funeral resources. Effective January 1, 2011, funeral agreements entered into for the Medicaid A/R family member with A/R property or a legally responsible parent must be irrevocable by law. As in the case of irrevocable agreements purchased for A/R, irrevocable pre-need agreements acquired for family members are agreements with a funeral business, a croque-mort, a croque-mort or any other person, company or entity that may establish such an agreement. A trust is a legal document, commonly referred to as a trust agreement or contract, by which a person sets aside a certain amount of money to be used for specific purposes. In the case of a funeral escoust√®me, this objective is to pay the funeral expenses.

The person who establishes the position of trust is called Grantor, Trustor or Trust Maker. The trust document designates a person, the so-called agent, who holds and manages the trust funds. Irrevocable funeral trusts (IFTs) or irrevocable funeral expense trusts, worded differently, allow individuals to pay their funeral and funeral expenses, also known as terminal expenses, before their death. These are legal agreements that not only help ensure funeral expenses are available if needed, but are also an invaluable Medicaid planning tool. Essentially, IFT Medicaid applicants offer the opportunity to reduce their accounting assets and reach the Medicaid asset limit for qualification purposes. Creating a funeral foundation ensures that your last wishes are met and help relieve your family`s stress as part of your latest editions so they can focus on celebrating your life.