Qualified Income Trust in Tennessee: How to Qualify for TennCare in 2026

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Written By Julia Price, JD

If you’re applying for TennCare (Medicaid in Tennessee) and were told you need a Qualified Income Trust (QIT), also known as a Miller Trust, you are not alone.

Families across Tennessee are often surprised to learn that being even slightly over the income limit can delay or prevent approval for long-term care benefits.

However, there’s good news: a Qualified Income Trust is a legally compliant solution that can help you qualify quickly.

What is a Qualified Income Trust?

A Qualified Income Trust (QIT) is an irrevocable trust used in TennCare planning to help applicants qualify when their income exceeds the state limit. Even if your income is just $1 over the TennCare limit, a QIT can restore eligibility.

TennCare Income Limits for 2026

As of 2026, the income limit for TennCare long-term care benefits is $2,982 per month. If you live in Tennessee and earn more than this amount, you are considered over-resourced and will not qualify, unless you establish a Qualified Income Trust.

A Qualified Income Trust can help Tennessee residents qualify for TennCare

A QIT allows Tennessee applicants to legally redirect excess income into a trust so that it is not counted by TennCare. This is often used for individuals entering nursing homes, assisted living facilities, and memory care communities.

How it works:

  • Additional income above $2,982 a month is deposited into the trust’s dedicated bank account

  • Funds in the QIT are not counted toward eligibility

  • The funds in the QIT are managed by a Trustee (not the applicant)

What can QIT funds be used for in Tennessee?

TennCare strictly limits how money in a QIT can be used.

Allowable expenses:

  • $70 personal needs allowance per month

  • Health insurance premiums (including Medicare supplements)

  • Community spouse income allowance

  • Cost of care

Important rules:

  • Maintain at least $20 in the QIT account for monthly fees

  • Funds cannot be used for general spending

What happens to a QIT after death?

All Qualified Income Trusts in Tennessee include a Medicaid payback provision. This means when the applicant passes away, TennCare can recover remaining funds in the QIT account.

Final thoughts and moving forward

Tennessee-specific rules and timing matter. Mistakes can delay benefits, trigger denials, and create gaps in care coverage. Working with a Tennessee-based elder law attorney helps ensure compliance with TennCare requirements and proper trust funding and administration, avoiding delays in coverage.

If you or a loved one has been told income is too high for TennCare eligibility, a Qualified Income Trust may be the solution. Being over-income does not mean you are ineligible. It means you need the right legal tool.

Julia Price, JD

Attorney Julia Price works closely with families dealing with important care decisions, helping them figure out both the care they need and how to pay for it. With her deep knowledge of Medicaid and VA benefits, Julia is particularly good at understanding the financial and care situations of her clients at Elder Law of East Tennessee and finding the best ways to get benefits for either in-home or facility care. She keeps up with the latest changes in the law, stands up for her clients with benefits agencies, ensures all the needed legal documents are sorted for future decisions, and strategizes to stretch assets to ensure top-notch care wherever it’s most fitting.

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