Special Needs Trusts

A special needs trust provides financial support for individuals with disabilities without jeopardizing their eligibility for government assistance programs. By placing assets in this trust, it helps ensure that the individual can receive supplemental care and services while still qualifying for benefits like Medicaid and Supplemental Security Income (SSI).

A special needs trust holds and manages funds for the benefit of an individual with disabilities, referred to as the beneficiary. This trust is typically established by a parent, guardian, or other third party.  Assets, such as money, property, or investments, are transferred into the trust for the benefit of the individual with special needs.  A trustee is appointed to manage the trust; this could be a family member, friend, or a professional trustee. The trustee is responsible for administering the trust according to its terms. The trust is designed to provide supplemental support for the beneficiary without jeopardizing their eligibility for government benefits. The trust funds can be used for various purposes, such as medical expenses, education, recreation, and personal needs not covered by public assistance programs. Since the assets are held in the trust and not directly owned by the individual with special needs, they are not considered when determining eligibility for government benefits like Medicaid and SSI. The trust allows for flexibility in meeting the unique and changing needs of the individual over time. The grantor (the person establishing the trust) retains some control over how the funds are used by providing instructions in the trust document.

It’s crucial to consult with an attorney experienced in estate planning to ensure the trust is properly structured and complies with state and federal regulations.