TN · Guide

How to Set Up a Qualified Income Trust in Tennessee: Step by Step

Tennessee does not publish a fill-in Qualified Income Trust form. To meet its requirements, an attorney (or, where permitted, you) drafts the trust to satisfy TennCare's own published policy, names a trustee, opens a dedicated trust bank account, and funds it with the applicant's income in the same calendar month you want coverage to begin. The trust diverts income above Tennessee's $2,982/month long-term-care Medicaid cap (effective May 1, 2026 (TennCare ABD Trusts Policy 110.055 revision)) so the applicant qualifies. For complex estates, consult a Tennessee-licensed elder-law attorney. This guide is informational only and is not legal advice — we explain what TennCare's policy requires; we do not draft the trust or provide sample trust language.

Tennessee does not publish a fill-in Miller Trust form, so the trust is drafted — by an attorney, or by you where permitted — to meet TennCare (Division of TennCare, Tennessee Department of Finance and Administration)'s own published requirements. Here is the full sequence, with the TennCare fact behind each step.

Confirm the applicant's income is over the Tennessee cap

A Qualified Income Trust only helps when monthly countable income exceeds Tennessee's long-term-care Medicaid limit — $2,982/month single (effective May 1, 2026 (TennCare ABD Trusts Policy 110.055 revision)). If income is under the cap, a trust usually is not needed.
Get the required-provisions checklist

Tennessee does not publish a fill-in QIT form. TennCare's own published policy (TennCare ABD Manual, Policy No. 110.055, Chapter "ABD Trusts," Section 4.h ("Qualified Income Trust (QIT) or Miller Trust"), effective 05/01/2026; Tenn. Comp. R. & Regs. 1200-13-20-.06(h) ("Qualifying Income Trusts (QIT) for Institutional and ECF CHOICES Applicants"); cross-referenced by 1200-13-20-.08(5) (Aged, Blind or Disabled Categories) and by Policy No. 115.015, "Institutional Medicaid" (revised 01/05/2026), which states the Medicaid Income Cap (MIC) directly: "The MIC is $2,982 effective 01/01/2026"; federal authority 42 U.S.C. § 1396p(d)(4)(B)) instead lists exactly what a compliant trust must contain — the checklist tells you what to bring to an attorney or verify in a draft.
Have the trust drafted

TennCare's ABD Trusts policy does not state whether a Qualified Income Trust must be attorney-drafted, and no Tennessee case or bar opinion specifically addresses QIT kits (see the UPL notes). But because TennCare publishes no fill-in instrument, drafting an original trust from the requirements below is, in practice, an attorney task for most families -- self-drafting an original legal instrument carries materially more risk of missing a required clause than filling in an existing state form would. Budget for an attorney; this kit is what keeps that engagement efficient.
Name a trustee

TennCare's ABD Trusts policy (110.055) never explicitly states that the trustee must be someone other than the individual -- it consistently treats "trustee" and "individual"/"grantor" as separate roles throughout ("the trustee shall distribute," "the trustee or a court...
Open the dedicated trust bank account

Open a dedicated bank account titled to the trust once it is signed. Branches commonly hesitate to open this account type, so know what to say before you go.
Fund the trust in the same calendar month

Deposit enough of the applicant's income into the trust account to bring remaining countable income below $2,982 — in the same calendar month you want coverage to start. TennCare does not back-date, so the month you fund is the earliest month eligibility can begin.
Distribute monthly and keep records

Each month the trustee pays out only the allowed items and keeps records. Staying inside TennCare's rules each month is what keeps benefits from being pulled.

The two steps families get stuck on are opening the bank account in Tennessee and funding the trust before the calendar month closes — see how long setting up a Tennessee Miller Trust takes for the timing rules.

What your Tennessee trust must contain

Tennessee does not publish a fill-in Qualified Income Trust form. TennCare does not publish a fill-in Qualified Income Trust form. Its own ABD Trusts policy (110.055, Chapter: ABD Trusts) sets out in detail what a compliant trust must do -- irrevocable, a defined monthly distribution process, a specific list of allowable payments, an explicit bar on trustee/attorney/accountant fees and other debts, and a State-of-Tennessee payback clause -- but does not attach a sample or fill-in instrument for applicants to complete. The checklist below is drawn directly from that policy's own criteria for a valid trust (Section 4.h.ii and 4.h.iv-vii), clause by clause, so you or your attorney can draft -- or verify a draft against -- a trust that actually satisfies what TennCare requires.

The step that isn't really paperwork

Opening the bank account is where families actually lose time — most branches have never opened this kind of trust account before. Free one-pager: the questions to ask before you drive to a branch, emailed now. Then 4 more short emails over 3 weeks — then we stop. No ongoing newsletter.

Common questions

What do you need before you start setting up a Tennessee Miller Trust?

Proof of the applicant's gross monthly income (a Social Security award letter, pension statements), and confirmation that income is actually over Tennessee's $2,982/month cap — a Miller Trust only matters if both are true. Knowing who will serve as trustee ahead of time also speeds up the rest of the process, since Tennessee does not allow the applicant to fill that role.

Is the Tennessee Miller Trust process the same as in other states?

The shape is similar everywhere — get the trust document, name a trustee, open a dedicated bank account, fund it, and submit it to Medicaid — but the specifics underneath vary by state: the exact form or requirements, the income cap, whether an EIN is needed, and the agency's own submission process. This guide covers Tennessee's specifics.

The Tennessee guide covers this

Everything above, plus the parts that actually trip families up

The verbatim bank-refusal script and a printable resolution letter for the branch manager
A pre-filled monthly funding worksheet using Tennessee's 2026 income cap
All 6 TennCare denial traps, each with the policy citation
The 8-item required-provisions checklist, cited to TennCare's own policy

Works the same whether you're family or a professional handling this for a client.

An elder-law attorney typically charges $1,000–$2,500 to research Tennessee's requirements and draft the trust; this guide does the research part, so the attorney's fee should reflect drafting alone. The guide is $97, one time. Instant download. Money-back if TennCare rejects it, or for any reason within 7 days. Informational only — not legal advice.

— James Whitfield, who followed this exact sequence himself. He built this guide after two attorneys quoted $1,500 and $2,200, and his own bank refused the account twice.

See the Tennessee guide — $97 →