Special Needs Trusts
A Special Needs Trust (SNT)-sometimes also referred to as a Supplemental Needs Trust- provides for the needs of a person with a disability by complementing rather than replacing government benefits.
It can be a self-settled trust, meaning the money in the trust belonged to the person with the disability. Or it can be a third party trust, meaning the trust is created and funded by someone other than the person with the disability, like a parent or grandparent. The person with the disability can benefit from the funds while maintaining eligibility for government benefits. The SNT supplements the government funds rather than using the trust funds solely for support. The SNT can pay for services and equipment that Medicaid would not cover, such as the purchase of a home, special wheelchairs, handicap-accessible vans, as well as vacations, a personal attendant and recreational and cultural experiences. The trust can be used to enrich the beneficiary’s life.
The trust must be valid under state law and must be in writing. The trustee of the trust has very specific fiduciary duties to the beneficiary of the trust to manage the assets properly and to see that the funds are used for the benefit of the disabled person and that his or her access to public benefits is not hindered by distributions from the trust.
If the trust is funded with the disabled person’s own funds, a “payback provision” is required to assure that the state will be reimbursed after the person’s death for the expenses paid on the person’s behalf. If the trust is funded by a third party, the payback provision is not required.
Parents of children with disabilities often have concerns about the care and welfare of their children after the parents are gone. Whether the child is an adult who has been cared for all his life by his parents or is a young child with a disability, parents can make provision now to see that their child is provided for.
The best way to provide your special needs child with compassionate care and a comfortable life is to support your legal and financial decisions with reliable information and proven expertise.
Contact us today to learn how we can help you with your trust.