Miller Trust QIT Calculator 2026 Medicaid Income Cap

A Miller Trust, formally a Qualified Income Trust (QIT), is an irrevocable trust authorized by 42 U.S.C. §1396p(d)(4)(B) that allows applicants in income-cap states to qualify for long-term care Medicaid when their gross monthly income exceeds the state's income cap. The 2026 federal cap is $2,901 per month (300% of the SSI federal benefit rate). Without a Miller Trust, an applicant with $1 over the cap is denied Medicaid even though their income falls thousands of dollars short of paying nursing home costs.

How a Miller Trust Works

Each month, the applicant deposits enough income into the QIT to bring the remaining "outside" income below the state cap. The trustee then disburses the deposited funds in a strict order: (1) personal needs allowance (typically $60-$75/month), (2) health insurance premiums including Medicare Part B, (3) community spouse income allowance if applicable, and (4) patient liability paid to the nursing facility. Any remainder at month-end may roll over but typically zeroes out. The trust must be funded monthly — missing a single month can void Medicaid eligibility for that month.

Income-Cap vs Medically Needy States

The Miller Trust is only needed in income-cap (also called "categorically needy") states. These include Alabama, Alaska, Arizona, Arkansas, Colorado, Delaware, Florida, Georgia, Idaho, Iowa, Louisiana, Mississippi, Nevada, New Mexico, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, and Wyoming. Medically needy states (California, New York, Pennsylvania, Illinois, Massachusetts, and most others) allow income above the cap and instead apply a "share of cost" formula where the applicant pays the excess directly to the facility. If you live in a medically needy state, you do not need a Miller Trust.

2026 Setup Requirements and Estate Recovery

The QIT must be drafted by an elder law attorney and contain the language required by 42 U.S.C. §1396p(d)(4)(B): the state Medicaid agency must be named as the residual beneficiary up to the amount of Medicaid benefits paid. On the beneficiary's death, any remaining trust assets first reimburse the state — this is estate recovery. Because the trust is typically zeroed out each month, residual balances are usually small. The bank account must be titled in the trust's name with a separate Tax ID. Mixing personal funds, missing monthly deposits, or paying non-allowed expenses voids the trust and triggers Medicaid clawback.

Common Miller Trust Mistakes

(1) Funding the trust late. The QIT must be operational the same month Medicaid coverage starts. Setting it up after application is filed creates retroactive eligibility gaps. (2) Mixing Social Security and pension. Each income source must be split — typically Social Security goes through SSA direct deposit and pension via ACH transfer. Joint deposits create commingling. (3) Using a revocable trust. Only an irrevocable trust under §1396p(d)(4)(B) qualifies. A living trust or revocable QIT is denied. (4) Forgetting estate recovery. The state has a statutory lien on residual trust assets — families surprised at death find any leftover funds reimburse Medicaid first. (5) Not transferring all income above cap. Some applicants try to fund only a portion; the trust must capture enough income to drop outside income below the cap or eligibility fails.

Last updated May 2026. Sources: 42 U.S.C. §1396p(d)(4)(B), 42 U.S.C. §1396a(a)(10)(C), SSI 2026 federal benefit rate ($967/mo individual), and state Medicaid eligibility manuals. The income cap is 300% of SSI ($967 × 3 = $2,901). Miller Trust setup requires a licensed elder law attorney — this calculator is informational only.