New Jersey Trust Attorney Explains Irrevocable Trusts for Medicaid Asset Protection

Christine Matus of The Matus Law Group advises how irrevocable trusts can help families preserve wealth and qualify for Medicaid long-term care benefits.

Published on Mar. 10, 2026

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New Jersey trust attorney Christine Matus of The Matus Law Group is providing guidance on how irrevocable trusts can protect assets from Medicaid eligibility requirements and estate recovery while preserving wealth for future generations. Matus explains that properly structured irrevocable trusts can remove assets from an individual's estate so the state cannot place claims against them after death, ensuring a home and savings pass to loved ones rather than being subject to Medicaid recovery.

Why it matters

Families planning for long-term care in New Jersey face strict Medicaid asset limits that can require spending down savings before qualifying for benefits. Irrevocable trusts offer a way to protect assets and preserve wealth for the future, while still allowing individuals to qualify for Medicaid coverage of nursing home or in-home care costs.

The details

According to Matus, an irrevocable trust is a separate legal entity that holds assets for named beneficiaries, and once created, it cannot be changed, amended, or revoked except under specific circumstances. The critical factor is whether the trust can pay the grantor or pay for the grantor's benefit - if so, Medicaid may treat those assets as available resources. Matus notes that Medicaid sets a resource maximum of $2,000 for an individual and $3,000 for a couple, and assets placed inside a properly structured irrevocable trust are not counted toward these limits. However, the five-year look-back rule is an important consideration, as Medicaid reviews all financial transactions made within 60 months before an application date, and any asset transfers during this period may be classified as gifts that trigger penalty periods.

  • Effective April 1, 2025, the Medicaid penalty divisor in New Jersey is $402.74 per day.
  • Transferring assets into an irrevocable trust more than five years before applying for Medicaid avoids the penalty entirely.

The players

Christine Matus

A New Jersey trust attorney and founder of The Matus Law Group, which specializes in estate planning, Medicaid planning, and asset protection.

The Matus Law Group

A Red Bank-based law firm dedicated to estate planning, Medicaid planning, and asset protection, serving families throughout Monmouth County and New Jersey.

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What they’re saying

“If the trust retains any provision allowing distributions to or for the benefit of the person who created it, Medicaid may treat those assets as available resources.”

— Christine Matus, New Jersey trust attorney

“Transferring assets into a trust without accounting for the look-back period can result in months of ineligibility at a time when care is most needed.”

— Christine Matus, New Jersey trust attorney

“Families who plan ahead with the right trust structure can ensure their home and savings pass to their loved ones rather than being subject to recovery claims.”

— Christine Matus, New Jersey trust attorney

What’s next

The Matus Law Group offers consultations to help families throughout Monmouth County and New Jersey plan for long-term care and protect their assets through the use of irrevocable trusts and other Medicaid planning strategies.

The takeaway

Irrevocable trusts can be a powerful tool for Medicaid planning, allowing families to preserve their wealth and ensure their assets pass to their loved ones rather than being subject to Medicaid's strict asset limits and estate recovery claims. However, proper planning and compliance with Medicaid regulations is essential to avoid penalties and protect eligibility.