Is a Qualified Income Trust (QIT), Trustee Entitled to A Commission?

By Fredrick P. Niemann, Esq. of Hanlon Niemann Wright, a Freehold, NJ Medicaid Attorney

In several counties trustee commission involving a QUIT have been permitted in Bergen County for once (CBOSS) , the County Board of Social Services advised the Trustee of a QIT that he was entitled to a 6% commissions. The patient later went to an assisted living residence in Ocean County. After a few months of accepting Trustee commissions, the Ocean County CBOSS advised the Trustee that he should not have accepted the commissions as Trustee despite the fact that he was advised by the Bergen County CBOSS to accept the commissions. CBOSS further advised the Trustee that it was ordering him to cease accepting commissions going forward and to reimburse the assisted living facility for all commissions previously earned. So what’s the law on Q.I.T. trustee commissions?

While under New Jersey trust law, a trustee is entitled to a 6% commission/fee, that doesn’t mean a Q.I.T. can pay it without disqualifying the beneficiary for Medicaid. The trustee commission fee’s priority is lower than the Medicaid cost share payment to beneficiaries so typically, there won’t be anything left in the trust to pay the trustee fee although occasionally where the income is high enough there may be enough $ to pay the commission. If the trustee takes the 6% anyway, he or she may disqualify the Q.I.T. beneficiary from Medicaid even though he/she would be in compliance with Title 3B of the New Jersey Trust Laws. The big issue here is the trustee’s conflict of interest between wanting to get paid and his duties to the Q.I.T. as trustee.

But please note that I have been recently advised that their case has been selected to be a test case for a fair hearing in Ocean County (transferred from Bergen County) to remove Trustee Commissions from a Trustee under a Qualified Income Trust. Ocean County has requested that the trustee file a fair hearing request. The County has also advised him that this will be a test case. The hearing is scheduled in Ocean County. I’ll advise our readers of the outcome.

To discuss your NJ Medicaid matter, please contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or email him at  Please ask us about our video conferencing consultations if you are unable to come to our office.