If you or your loved one has a disability, proper estate planning is crucial! A Supplemental Needs Trust, also known as a Special Needs Trust, is often the perfect option. A special needs trust enables you to provide financially for the care of a family member with a disability, or to provide for yourself if you have a disability and are funding the trust with your own money.
The primary objectives of a Supplemental Needs Trust are to protect the assets left to a special needs beneficiary from predators and creditors, provide additional income to a person with a disability to facilitate a better quality of life, and to prevent the loss of government benefits, including Supplemental Social Security (SSI) and Medicaid. A supplemental needs trust is a legal tool that allows an individual who has a disability or is chronically ill to receive funds without reducing their eligibility for the public assistance disability benefits provided by Social Security, Supplemental Security Income (SSI), or Medicaid.
Third-party Supplemental Needs
A third-party supplemental needs trust cannot be funded with money from the individual with a disability. Any person aside from the individual with the disability can create and support this trust, such as parents, grandparents, aunts, uncles, etc. The money that is in this trust is not considered assets of the individual with a disability, which means they still qualify to receive government benefits like SSI and Medicaid.
Factors To Consider When Choosing Trustees
Assets held within trusts typically grow over time, so it is highly recommended that you choose a trustee that has financial knowledge, allowing them to properly manage the trust assets. The trustee should also understand the beneficiary’s unique needs and situation. The trustee should be able to communicate well with the beneficiary, service providers, and caregivers. In addition, the individual should know the government benefits that the beneficiary is receiving.
Planning for the life of your special needs family member after you pass can seem scary and daunting. The laws governing special needs trusts are varied and complex. The attorneys of Legacy Counsellors, P.C. have personal experience caring for loved ones with disabilities and have decades of experience creating trusts for people with special needs. Contact us today if you have a special needs family member that needs planning.