What is an Income Only Trust a.k.a. Miller Trust and how does it help qualify for ALTCS?

What is an Income Only Trust or Miller Trust?”

Think of the income-only trust as a “Funnel” with spouts on its side as well as the bottom.

The person applying for ALTCS sets up their or assigns their total income to the Income Only Trust or think of the income as poured into the Trust.

Note that married couples’ income is separate, and the healthy (non-applicant)  spouses’ income is not placed in the trust.  Also noteworthy the healthy spouse  can have unlimited income.  Meaning just that “unlimited”! 

Income that is transferred to the Trust can only be used for the applicant’s allowable expenses. Only income can be placed in the trust and only medical and care expenses can be paid with funds in the trust.

These expenses include:

ALTCS Applications Approved

1: The  Monthly Personal Needs Allowance, which for 2021 is $119.10.  This is the monthly allowance for the applicant for personal needs,  like hair cuts and church contributions.

2: Any Medicare and dental insurance premiums

3: Medical expenses that are not covered by the program.

If married, additional income might be allowed for the well spouse. This is called the Community Spouse Resource Allowance. This can help pay their living expenses.  This can be confusing because as already mentioned the well spouse can have unlimited income.  But they are also allowed the “Minimum  Monthly 

Then the balance of the income flows out of the bottom of the funnel and is used to the share of cost for the care home or community. Or I like to call the “co-pay”. 

Once set up “wall-la”,  Income is no longer a bar from being approved.

So how do you get an Income Trust prepared?

Cecilia Dabbs, CMP, LCP is a legal document preparer and is legally able to prepare the “Income Only Trust” Document. 

For Care Funding Solutions ALTCS planning clients the document is prepared by Cecilia at no additional cost and Steve Dabbs, CMP will spend as much time as needed with the family explaining the steps on how to set up a “Zero balance” bank account and how to administer the trust.

Call us at 480-967-8477 or see form below to get started. 

Why do you need an “Income Only Trust”? 


There are 24 Income Cap states, including Arizona. In Income Cap states, if your income is even $1.00 over then, you will be disqualified for benefits. 

The exact problem happened in Colorado, also an Income Cap state. Here L. Jeanette Miller was the “Representative Plaintiff” for her mother, Lottie Bernice Ham. Join in the lawsuit Miller v. Ibarra were three other plaintiffs.

Therefore the name “Miller Trust.”

Irene Ibarra, the Executive Director of the Colorado Department of Social Service, filed a lawsuit in the United States District Court in Denver, Colorado.

What caused the issue?

Her mother was on Medicaid for over four years; then, she started receiving Veterans Pension benefits once her husband passed. The pension caused her income to be above the cap. So the on September 19, 1988, the district court of Jefferson County ordered Lottie’s entire income to be placed in a Trust, and the rest is history.

The Miller Trust was born. In Arizona, it’s called an “Income Only Trust”. Other states call it a “Qualified Income Trust.”

Three “Income Only Trust Packages to choose from. 

  • Premium IOT Package – Free to Planning clients
    Complete support – Even be on the phone when you are at the bank setting up the account.   Call for non-client pricing. 
  • Complete IOT Package – Free to Planning clients
  • Do it yourself Package – Call for pricing and details
    480-967-8477