Special needs trusts have provided peace of mind for families for years. Designed to ensure a disabled beneficiary receives what he or she needs in the future, these financial tools also provide for the extra comforts of life for the recipients. It is a powerful document that prevents others from interfering with your disabled loved one’s quality of life. Keep reading to learn five more ways a special needs trust can help. Remember, these are just five of the reasons many clients choose these trusts.
Special Needs Trusts as an Income
Many disabilities prevent employment. A special needs trust can work in tandem with Medicaid, SSI and other government benefit programs. It can help offset the limitations of those benefits while also providing funds for the things we do that aren’t necessarily “needs”, such as seeing a movie. The key is funding these trusts with the types of assets that won’t interfere with the qualification guidelines with any government programs.
The Little Things
Did you know that a special needs trust can also provide funds for vacations, some medical expenses, personal care attendants and educational courses? As mentioned above, dinner and a movie is another typical expense these trusts can cover and there are many more, too. Your estate planning lawyer can provide more information on allowed expenses. Also, the assets in a special needs trust are not subject to creditors.
Financial Limitations
The maximum dollar amount in countable resources that a disabled person can have without risking his Medicaid or SSI coverage is $2,000. Again, an experienced attorney in Medicaid planning and special needs trusts can provide important guidance.
Unique Dynamics
A special needs trust differs from other trusts, including a self settled trust. In a self settled trust, a clause requires any remaining assets in a trust after the beneficiary’s death be used to repay Medicaid or any other costs associated with the care of the recipient. In a special needs trust, the remaining assets can be passed to an heir.
Age Limitations
A special needs trust can only be formed to benefit someone under the age of 65. While they’re often used to protect minor children, they’re also a great way to ensure assets are earmarked for disabled adults as well. You can name a trustee to help oversee the trust if you are unable to do so.
As you can see, there are many benefits and reasons for establishing special needs trusts for your disabled loved ones. They offer peace of mind, are strong financial tools and have benefits that far outweigh any downside. Contact our legal advocates today to learn more about these exceptional financial planning and estate planning tools.
- What You Need to Know to Protect Your Special Needs Child - May 30, 2023
- How Tax and Non-Tax Considerations Impact Estate Planning – Part I - May 25, 2023
- The IRS’ Annual Warning: The 2023 Dirty Dozen - May 23, 2023
