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My Father, his wife and myself are all on his checking account. The money deposited is from his VA & SS benefits. A few months ago my dad transferred a sum of money into a Trust Account with me as his beneficiary. He is now being told he has less than 6 months to live. His wife whom is not my mother has dementia and she may have to go into a nursing home within a year or so. My question is "are the funds in the Trust Account secure from the state if this should happen"?

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Just What kind of atty did this Trust?
You need to take all legal paperwork of theirs and get it reviewed by a NAELA or CELA level of elder law atty & asap.

Does your dads wife have children? If so, what is your relationship with them?
I ask this cause if he completely excluded his wife - who is medically at need -in the trust done just 6 months ago, by creating the trust from their $, and by doing so leaves her without resources to pay for her care so she has to file for Medicaid in the near future expect her family as well as Medicaid to do whatever to secure assets from that trust to pay for her care. 

For Revocable Trusts, Medicaid expects them revoked & spent down.
For Irrevocable kinda have 2 paths depending on how they are or are not income producing & either can have a transfer penalty inquiry done by Medicaid which places a period of ineligiblity on the Medicaid applicant but each has a different formula. 
Her family can make your life very difficult, whether revocable or irrevocable & whether or not moving dads $$$ was done deliberately or inadvertently by dad/you to exclude her. If she has no family, then she can be made a ward of the state. The state appointed guardian can go after resources moved that they think were done improperly. This can morph into a real problem for you as dads old dpoa and trust beneficiary & will not be at all pretty.

Really get NAELA CELA atty to review.
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Some of the people here are suggesting that "the state" wants to take their parent's money, thus depriving them of their inheritance. This is wrong, dishonest, and immoral. These people are trying to steal the state's money, aka taxes paid by hardworking citizens, to pay for their parent's care. If your parents have money, that money should be used for their care, not your inheritance. Money that your father earned during their marriage belongs to his wife, and should be used for her care. In no case should taxpayers be paying for your parent's care so that you receive an inheritance. If you need money, get a job.
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Sadlostdaughter, this is a matter that you need to make an appointment with an "Elder Law Attorney" to advise you on this matter.
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I have two cents to put in on this matter. I am an early onset Dementia/maybe ALZ patient in my late 50's, my DW just turned 50. We were just making arrangements for our estate when I was diagnosed. We then went about moving everything we owned and saved in to a Trust in solely my wife's name, and with a Declaration that no provisions were being made for my support. We are now 16 mos in to the establishment of the Trust. Once we hit the five year mark I will of had only my SSI, and will have an Annuity in my name that I could touch because I am permanently disabled, but have chosen not to do anything until I have reached 59 1/2 in Jan 2019. The Annuity could not legally be moved in to my wife's name. What we don't use for my support in the ensuing years, can be used to get me in the door of a Memory Care Unit, if I live long enough to have anything left.
My point here is to encourage those reading , to think about yourselves. Have you looked at creating a Trust, a DPOA, appointed an agent to oversee that your Medical Directive is carried out and honored? Burial Plans? Done a pour over will for the things you may have forgotten to put in to a Trust. We had one attorney draw up the Trust and all of the other legal work that needed to be done for both my DW and me. Then we brought in an Elder Care Lawyer with another set of eyes to see if we missed anything. The answer was that the attorney setting up the Trust etc handled our affairs perfectly.
Yes, having all this work done is expensive. We spent about Five Grand, covering both attorney's. Yes, it is even more expensive for you to ignore this.
Once this was complete, we insisted our adult children pour over the 250 or so pages and see who had what roles in administering the Trust when my DW couldn't handle things, hopefully a very long time off in the future. We also made sure they understood, what my wishes were for them and my DW and that all of my actions were in fact my wishes and that my DW supported me and respected my End of Life wishes.
Time is running short. Take action for yourselves so your children will be familiar with your wishes and how you plans to distribute your estate, and who the Trustee will be.
Don't forget to encourage your children to look at LTC for themselves, the earlier they can afford to start affording premiums, they will be better off. Fortunately we purchased it for my DW when she was 40, the LTC purchased has no limit to how long they have to pay for treatment, and she can make GPO's every 2 yrs to help keep up with inflation. I was found to be medically disqualified for LTC when undergoing the underwriting process at the age of 43. I hope this is helpful to any that read my remarks.
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A trust fund is still money. It is also still your dad's money. I should think this is still countable for Medicaid spend-down if it comes to it.

I was to inherit the house. But if my parents had needed a NH, the NH would have made him sign the house over before accepting him.

You have no legal claim on inheritance while the person is still alive.

Speak with an Elder Attorney but I think I have it right - and Good Luck to you. You can't count on the trust fund being there unless you are paying out of pocket. My GF had to pay for the NH care to save her Trust Fund. It's a lot of money out of pocket when you must pay the NH.
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Who did your Dad go through to get the trust fund? Call them to find out. They will have the answer, I'm sure. If they don't, then call an elder lawyer who specializes in all things concerning seniors and their final years.
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JF - how wonderful for doing this for both you and your wife. Planning & planning with concern for your wife is the ultimate 💕, don’t you think?

What bothers me about the OP is that the beneficiary of the trust is her, the daughter. And - to me & I could be wrong - her post comes across as she’s afraid Medicaid might require trust $ to actually be used to pay for his wife’s care. Her “are funds secure from the state” part implies that. The $$$ was just moved 6 months ago. I’d bet a case of prosecco that dad & stepmoms health charts show significant health & disease issues of long standing. $$ move can be viewed as a planned attempt to circumvent Medicaid’s asset spend down as Trust beneficiary is the daughter. Not the wife.
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Igloo, I agree with you. It sounds like funds are being hid so the wife has nothing. I bet medicaid will think the same thing too.

jfbctc59, your comments are so right on. You are a HUGE help to myself and I am sure others. (((hugs)))
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Consult an Elder Law Attorney that specializes doing a trust & Medi-caid (medi-cal Calif). Big difference between revocable & irrevocable. Irrevocable is what you want.
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This is a complex question, and you should ignore all the answers here from people who are just guessing. This is not a question for a general law firm that does everything from traffic offences onward, it is for a specialist in trust law and elder law. The money that you spend to get the right advice is far less than the money you stand to lose. I am a retired solicitor, and I would not and could not answer it myself.
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