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Special Needs Trust For Those That Depend On You
A special needs trust, sometimes called a supplemental needs trust, is the generic term for a trust that does not interfere with important government benefits (typically Medicaid and Supplemental Security Income). It generally allows a person with a mental or physical disability to have assets held by a trustee who can supplement what the government already provides. A special needs trust is different than a trust created for a non-disabled beneficiary, such as money held for a minor child or money held for an irresponsible adult. Assets held in a special needs trust under very specific provisions do not interfere with these programs. This will allow the person to have full access to benefits while still being able to use the special needs trust funds for other needs.
There are a number of types of special needs trusts. The most common one we deal with is the special needs trust created for a child (or other relative’s benefit), typically called a “Third Party” special needs trust. This allows the settlor (the party creating the trust) to make sure that their disabled loved one is fully supported but still receives his or her Medicaid benefits. If a special needs trust is not created, any money distributed to that child will typically remove him or her from Medicaid.
There are other types of special needs trusts that we help families with:
- First Party Special Needs Trusts - these are usually created for accident victims who receive Medicaid until money comes in as part of litigation/settlement.
- Pooled Trusts - These can be an excellent way to hold smaller amounts of money for a disabled person's benefit. Here, a charity typically "pools" disabled people's money together and holds the money for a beneficiary with specific rules of distribution.
- Spousal Special Needs Trusts - In very specific situations, a trust can be created in the will of the first spouse to die. This is typically used when one spouse is in the nursing home and we are concerned about the community spouse's health.
How A Special Needs Trust Can Help
- A special need trust will protect assets while making the person eligible for government benefits
- A special needs trust will step in to provide the money needed for care beyond Medicaid and other government benefits
- A special needs trust can add to a beneficiary’s quality of life by providing life’s extras, not just the necessities
- A special needs trust can pay for vacations, social events, and sports activities
- You get peace of mind knowing your disabled loved one is provided for
Food For Thought: What You Should Know About Special Needs Trusts
A special needs trust is an estate planning document that is designed to benefit people with disabilities. A special needs trust can be a stand-alone document or it can be a part of an estate plan that includes a last will and testament.
A special needs trust enables a person with a physical or mental disability to have an unlimited amount of money held in trust for his or her benefit. The money held in trust are not counted for the purposes of qualifying for some governmental benefits such as SSI, Medicaid, vocational rehabilitation, subsidized housing and other benefits. The money in the special needs trust can then be used for medical, living, or other costs of care beyond what the government benefits provide.
Special Needs Trust Can Provide Peace Of Mind
If you have someone special who depends on you, you should contact our office at 727-835-5502 or use the form on the right to schedule a consultation to see how a special needs trust can help provide you peace of mind.