MMM Trust Income

Revised 12/19/2023

Policy

For MAGI programs, only the income added to or earned by the trust is counted as income for the trust owner. Any amount distributed from the trust that is more than the income added or earned is considered paid from the trust principal and is a resource conversion, not income. 

For the non-MAGI programs, how trust income is counted depends on the type of trust and the specific MA program. 

• For the ALTCS program, see Chapter 800. 

• For SSI-MAO and MSP, see the table below for how to count trust income:

If the trust type is...	Then the treatment is...
Medicaid Qualifying Trust	Income assigned to the trust is counted in the month it would have been received by the customer.
Testamentary trusts and non-grantor trusts	When the beneficiary cannot access the trust principal: Any disbursements made directly to the beneficiary are counted as unearned income. Disbursements not issued directly to the beneficiary are not counted. When the beneficiary has a right to the income produced by the trust, it is counted as it becomes available, whether it is actually paid to the beneficiary or not. When the beneficiary has no right to the income produced by the trust it is not counted.
All other trust types	Count the higher of the following amounts as unearned income: Income received by the trust, except for interest earned by the trust, or Disbursements from the trust directly to or for the benefit of the customer

 

Definitions

Term	Definition
Trust	Any arrangement where money or property is entrusted to one or more persons with the intent that it be used for the benefit of someone else. See Chapter 800 for more detailed information and definitions for trusts.

 

Proof

Proof of the terms of a trust and the person’s access to the trust includes:

• A copy of the trust instrument or other document establishing the trust with all amendments or restatements to date;

• Trust instrument;

• Court records;

• Court approved injury settlement; 

• Will; and

• Schedule A (can also be referred to as an attachment or a different type of schedule or exhibit. Schedule A is most common).

 

Proof of income received, earned, or distributed by the trust includes:

• Trust accounting records;

• Trust financial account statements showing deposits and distributions; and

• Canceled checks drawn on the trust account.

 

Legal Authority

Program	Legal Authorities
ALTCS SSI-MAO Medicare Savings Program	42 USC 1396p(d) ARS 36-2934.01
Adult Caretaker Relative Pregnant Woman Child KidsCare	42 CFR 435.603 42 CFR 457.10, 300, 301 and 315