Special Needs Planning
The primary purpose of a special needs trust is to provide for the needs of an individual without disrupting that person’s eligibility for Medicaid and Social Security and other government benefits. There are many ways to protect your assets and still get Medicaid or Supplemental Security Income (SSI) benefits for your child or loved one. As an experienced estate planner and elder law attorney, Ms. Armstrong understands the legal options available. Based on the family and individual’s needs and circumstances, she can determine the best solution possible.
A special needs trust, also known as a supplemental needs trust, is established on behalf of a person who is mentally or physically incapacitated under the Social Security Administration’s definition of disability. It is most commonly created for an adult child with mental or physical disabilities to preserve eligibility for Medicaid (KanCare), Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI). We can structure the special needs trust to ensure your loved one has the provisions necessary to maintain his or her quality of life without losing government benefits.
How Does a Special Needs Trust Work?
Assets in a special needs trust are distributed to the beneficiary at the discretion of a trustee. The parents can designate themselves as the trustees, as well as a successor trustee in the event they die before the beneficiary. The trust cannot pay for basic needs, which are covered by government benefits and programs. The trustee can authorize expenditures for such things as:
- Vacations, summer camp, and travel
- Concerts, movies, restaurant meals, and social outings
- Sporting goods, cosmetics, and other quality-of-life items
- Legal fees
- Medical treatments not covered by benefits programs
- Cable television, online subscriptions such as streaming, social media, games, newspapers
Three Types of Special Needs Trusts:
- A Self-Settled Special Needs Trust preserves assets of the individual such as an inheritance or proceeds from a personal injury settlement. Without the trust, the person would have to spend all personal assets to qualify for government programs. This type of trust is the so-called (D)(4)(A) Trust.
- A Third-Party Settled Trust is funded by someone other than the individual with disabilities. This type of trust does not have payback provisions, meaning when the individual dies, the remainder can be passed on to other named beneficiaries. This type of trust is traditionally established by the parents or grandparents of the individual with disabilities through their own estate plans.
- Pooled Trusts are established and managed by non-profit organizations. Individual beneficiaries create sub-accounts within the larger trust, but the assets themselves are pooled for investment and management purposes. This type of trust is the so-called (d)(4)(C) Trust.
Ms. Armstrong understands the unique challenges faced by families caring for individuals with Autism, developmental delays, substance abuse, mental health conditions, or other physical disabilities. She can help you navigate the legal and financial landscape to ensure your loved one’s financial security, legal rights, public benefits eligibility, quality of life, and most importantly, their dignity. Contact Generations Estate Planning & Elder Law, LLC to schedule an initial consultation to begin the process of creating a solution specific to the needs of your loved one.
Medicaid & Long-Term Care Planning
Estate Planning
