Ninety-nine thousand six hundred dollars.

No, that is not how much money Bill Gates has made today. It is the average yearly cost of a nursing home. For those of us less wealthy than Mr. Gates, this number is frightening.

However, due to changes in the tax code, a rarely used estate-planning tool is now the perfect fit to protect your assets from the rising costs of nursing home care. This tool is called the iPUG Trust.

The acronym “iPUG” stands for Irrevocable Pure Grantor Trust. This type of trust is not new; however, the iPUG is becoming more commonly used in estate planning.

In years past, when the estate tax level was much lower, the iPUG was not used to protect assets because one would lose some control of assets and receive the same tax treatment one would have received had he not created the trust at all.

In other words, even though the assets were protected from nursing home costs, the client was still vulnerable to estate taxes and lost some control over his assets.

Instead of using the iPUG, people protected their assets from estate taxes as well as nursing homes by using traditional irrevocable trusts. These trusts were incredibly onerous and complicated, and forced the grantor to lose all control over his assets.

Traditional irrevocable trusts are no longer necessary, because now estate taxes apply only to estates over $5.43 million – affecting less that 1 percent of all estates. So, planning to avoid estate taxes is not a concern for the majority of people.

This is how the viability of the iPUG for estate planning came about: With no estate tax concerns, protection of assets from nursing homes became paramount.

Both traditional irrevocable trusts and iPUG’s can be designed to protect your assets from the costs of a nursing home. However, in contrast to traditional irrevocable trusts, in which you lose all control of your assets, with the iPUG you still maintain most of the control over your assets that you have right now.

You enjoy the income that your assets produce, you control when and where your assets are invested, and you control who your beneficiaries are and when they receive your assets, during your life and after you pass.

All the while, you are keeping your assets protected from the costs of a nursing home.

The only bit of control you lose over the assets that you put into the iPUG is that you cannot take the asset out of the iPUG and put it back into your own name.

To enjoy Medicaid benefits, the Medicaid office is allowed to look only to the applicant’s assets and his or her spouse’s. Once a beneficiary receives a distribution from the trust, what they do with it is their own business.

Using the iPUG in your estate plan means you get to enjoy the fruits of your labor while protecting them from the threatening costs of nursing home care.

Victor Seeger, Esq. is a new associate attorney at the Estate Planning and Elder Law Center in Bluffton.