Revocable V. Irrevocable
The difference is actually quite simple, a revocable funeral trust can be dissolved at any time by the person who originally created it and the funds will be accessible, while an irrevocable funeral trust cannot be dissolved, the funds cannot be accessed until the terms of the trust have been met.
For that reason, an irrevocable funeral trust get s much more favorable treatment from Medicaid. Funds set aside for burial that are revocable and accessible have a maximum limit of $1,500 while funds in an Irrevocable Funeral Expense Trust have a maximum limit in most states of $15,000 [more details of state limits will be covered below]. The difference allows you to shelter much more money, qualify quicker and add peace of mind to your loved ones.
Example: Joe enters a nursing home in New Jersey, he and his wife Anne have excess resources of $26,000. If they each purchase an Irrevocable Funeral Expense Trust for $13,000, Joe will qualify financially for Medicaid benefits and there loved ones will have peace of mind.
What is an Irrevocable Funeral Expense Trust [IFET]
The IFET that we offer is a blend between a guaranteed issue life insurance policy and an irrevocable trust. The trust is issued and controlled by an insurance company and there are no trust agreements to draft or fees of any kind.
Owners of an Irrevocable Funeral Expense Trust benefit from all of the following:
- Immediately shield assets from Medicaid and nursing homes
- Peace of mind knowing funds are guaranteed to be there when needed most
- Benefits are distributed immediately and tax free
- Excess funds are distributed to the individuals estate
- Funds can be used to pay for travel expenses, food & lodging for family members to attend a funeral
- Assets cannot be confiscated by any nursing home, creditors or lawsuits
- Funds can allow a portion to be used as a gift for a church or synagogue where the funeral is held
- Asset Protection
- Exempt from Medicaid "spend down" requirements
- Funds are insulated against inflation with an increasing death benefit
- No lengthy delays caused by probate court proceedings
- Free from estate taxes
How much money may be set aside in an Irrevocable Funeral Expense Trust?
In order for the funeral trust to not be overly scrutinized or potentially cause an issue in regards to the amount, the rules state that the amount must be of "fair consideration" which means that it should not exceed the average local cost of a funeral with each state having there own maximum limit as stated below;
- Pennsylvania....Each of Pennsylvania's' 67 counties list their own max. limits. Such as in Allegheny County the max. is $15,000 Bucks County - $10,200, Dauphin County - $9,000 and so on, with their "fair consideration" test being met providing the trust does not exceed the average local costs or limits by more than 25%.
- New Jersey......$15,000
Questions? Email: or contact us at 855.471.6771 Email: firstname.lastname@example.org
An Irrevocable Funeral expense Trust can be set up by our office in a very short period of time, just fill out 1 simple form and you're done, we'll take care of everything else.