1. Purpose: Used to Qualify for Medicaid While Protecting Assets
  2. No Guaranty
  3. A Trust with Many Names
  4. Lifetime Trust
  5. Typically Drafted as a Self-Settled Trust
  6. Must Be Irrevocable
    1. Reason MAPT Must Be Irrevocable
    2. Trusts in NY Irrevocable by Default, But Explicit Statement is Best
    3. What “Irrevocable” Actually Means
    4. Revocation Under EPTL 7-1.9 Is Possible
  7. Benefits of a MAPT
  8. MAPT Is Superior to Outright Gift
  9. Downsides, Risks of a MAPT
  10. Estate Recovery: Unlikely, But a Risk

Purpose: Used to Qualify for Medicaid While Protecting Assets

The purpose of a MAPT is to help a Medicaid applicant qualify for Medicaid by preventing the trust’s assets from being counted as an available resource. But transfers to a MAPT must be made before the look back period.

Qualify for Medicaid. Medicaid is the main way in which middle class people pay for long term care. Most people don’t have long-term care insurance. Medicare does not meaningfully cover long-term care.

Protect Assets. A MAPT helps the creator qualify for Medicaid so the creator can preserve some assets. Assets that are transferred to a MAPT should not1 count as an available resource for purposes of Medicaid eligibility.

A MAPT can protect some or all of the trust’s corpus, depending on when the transfer was made. If the transfer was made outside of the look back period, then the entire corpus may be protected. If the transfer is made within the look back period, then a portion of the corpus may be protected.

Question Yes No
Transfer made outside of look back period? Entire corpus may be protected Portion of corpus may be protected

No Guaranty

A properly drafted trust will minimize the likelihood that Medicaid will count the assets that are transferred to the trust as a resource, but there is no guaranty. Medicaid frequently makes new arguments to challenge irrevocable trusts. If the applicant cannot resolve an issue with Medicaid, then the applicant must litigate it in court, where there is no guarantee of prevailing.

A Trust with Many Names

A Medicaid Asset Protection Trust (MAPT) can have many names, including “Irrevocable Income Only Trust,” “Asset Protection Trust,” and “Medicaid Qualifying Trust.”2 I prefer using “Medicaid Asset Protection Trust (MAPT),” rather than “Irrevocable Income Only Trust (IOLT)” because the creator may or may not reserve the income interest.

Lifetime Trust

A MAPT is a lifetime trust.

Typically Drafted as a Self-Settled Trust

A self-settled trust is a trust in which the grantor retains a beneficial interest. A MAPT is typically drafted as a self-settled trust because the grantor typically retains the trust’s income or the right to live in a home that is transferred to the trust. But a MAPT must never allow the grantor (or the grantor’s spouse) to have a beneficial interest in the trust’s principal.

Must Be Irrevocable

Reason MAPT Must Be Irrevocable

A MAPT must be structured as an irrevocable trust. The assets of a revocable trusts are considered available resources for purposes of Medicaid eligibility.3 In contrast, the assets of an irrevocable trust are not considered available resources if “no payment could under any circumstances” can be made to the grantor.4

Trusts in NY Irrevocable by Default, But Explicit Statement is Best

Even though trusts in New York are irrevocable by default,5 a MAPT should have a clause explicitly stating that the trust is irrevocable. Here is a sample clause:

This trust shall be irrevocable and shall not be subject to any alteration or amendment.

What “Irrevocable” Actually Means

Most people think that “irrevocable” means the trust creator cannot revoke or amend the trust. But this definition is incomplete.6 A trust is “irrevocable” because the trust creator cannot unilaterally amend or modify the trust.

Revocation Under EPTL 7-1.9 Is Possible

EPTL 7-1.9 allows the creator to amend or revoke the trust upon the written, notarized consent of the trust’s beneficiaries.

Medicaid tried to argue that EPTL 7-1.9 makes the assets of an irrevocable trust available for purposes of Medicaid eligibility, but Medicaid was unsuccessful.7

In Spetz v. N.Y. State Dept’s of Health,8 the NY Supreme Court stated:

the speculative possibility of a revocation pursuant to EPTL 7-1.9 does not render the corpus of the trust “potentially available” to the petitioner. . . .

. . .

. . . social services may not treat trust assets as being potentially available to an applicant or spouse where they cannot be reached without consent of the trust beneficiaries. To hold otherwise would eviscerate the federal and state statutes providing, in detail, for the protection of assets through the use of irrevocable trusts, since every trust would be presumed to be revocable under section 7-1.9.

Benefits of a MAPT

A properly drafted MAPT can help protect the grantor’s assets and still allow the grantor to qualify for Medicaid because the trust’s assets are not counted as an available resource for purposes of Medicaid eligibility.

Like other trusts, a MAPT can have additional benefits:

  • allow the grantor to retain some control
  • minimize taxes
  • avoid the cost and delay of probate
  • centralized management of assets by a trustee
  • allowing the trustee to implement an investment plan
  • continuity in the event the grantor becomes incapacitated (or after the grantor dies if the trust continues for the benefit of others)

MAPT Is Superior to Outright Gift

A MAPT is superior to an outright gift for several reasons:

  • With an outright transfer (e.g., a gift to child), the donor loses all control over the asset.
  • An outright transfer exposes the asset to the donee’s creditors. So, for example, if the child is sued or divorces, the asset is not protected.
  • Donees get a carry-over basis in outright gifts. So, if they will pay an enormous capital gains tax when they sell assets that have appreciated significantly.

Downsides, Risks of a MAPT

The risks to a MAPT are (1) estate recovery by Medicaid, and (2) Medicaid reaching the assets of a MAPT by forcing the recipient-surviving spouse to assert the right of election.

Estate Recovery: Unlikely, But a Risk

“Estate”: Narrow Broad
Federal: State chooses State chooses
Estate includes probate assets? Yes Yes
Estate includes nonprobate assets? No Yes
Medicaid can recover from irrevocable trust under def? No Yes
New York’s def of estate: Yes No
Medicaid can recover from irrevocable trust in NY? No n/a

After the Medicaid recipient dies, there is a risk that Medicaid might recover payments that it made from the assets of a MAPT.

Federal law allows states to choose whether to define an “estate” for purposes of Medicaid recovery narrowly or broadly:

  • In the narrow definition, an “estate” includes only probate assets.
  • In the broad definition, an “estate” includes any asset in which the decedent had an interest at death. So, it encompasses both probate and non-probate assets. And it can include assets transferred to a trust.

New York State has adopted a “narrow “ definition of “estate” for purposes of Medicaid recovery, SSL 369(6), so Medicaid cannot recover from the assets of a MAPT.

SSL 369(6) defines estate as “all real and personal property and other assets included within the individual’s estate and passing under the terms of a valid will or by intestacy.”

In 2011, the risk of estate recovery seemed to become real in New York when New York adopted an expanded definition of “estate.” But in 2012, this expanded definition was repealed as part of the budget process.

After a Medicaid recipient dies, Medicaid cannot recover from assets transferred to a MAPT because those assets pass outside of the probate estate, and they pass according to the terms of the trust, and not by intestacy.

This said, the MAPT has to be correctly drafted. For example, Medicaid can recover from the assets of a MAPT if the grantor reserves a general power of appointment.9


  1. A MAPT must be properly drafted, and there is always the risk that Medicaid will make a novel argument to attempt to reach the trust’s assets. 

  2. See Melissa Negrin-Wiener & Marcus O’toole-Gelo, Adapting Asset Protection Trusts to Changes in Circumstances, NYLJ, Jan. 25, 2021 (“An Irrevocable Trust used for asset protection may have a different name depending on who you ask [Irrevocable Income Only Trust, Asset Protection Trust, Medicaid Qualifying Trust, etc.], but its primary purpose remains the same.”). 

  3. 42 U.S.C. 1396p(d)(3)(A). 

  4. 42 U.S.C. 1396p(d)(3)(B), 18 NYCRR 360-4.5(b)(1)(ii). 

  5. EPTL 7-1.16 states, “A lifetime trust shall be irrevocable unless it expressly provides that it is revocable.” 

  6. See Michael J. Amoruso in Using EPTL § 7-1.9 to Revoke an Irrevocable Trust - Tax and Medicaid Considerations, April 11, 2005 (“While conventional wisdom implies that an irrevocable trust is irrevocable, a New York trust is not irrevocable in the purist definition of the term.”). 

  7. Spetz v. N.Y. State Dept’s of Health, 737 N.Y.S.2d 524, 190 Misc. 2d 297 (NY Supreme Chautauqua County 2002). 

  8. Id. 

  9. Matter of Albasi, 196 Misc. 2d 314, 765 NYS2d 213 (Sur. Ct. Bronx County 2003).