Special Needs Trust in New York

A special needs trust in New York is a beneficial tool if a family member has special needs. It is important to consider a special needs trust for them because a special needs trust will ensure that the person in need receives finances in an efficient and smart way. A special needs trust in New York will help with their treatment and will work harmoniously with programs such as Medicaid.
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important things you should know

Questions And Answers

A special needs trust is a type of trust that enables a person to provide funds for a person who suffers from chronic illness or a severe disability. This is usually a child or grandchild.
Anyone can create a special needs trust. If a person wishes to create a trust to benefit someone else, they may do so. This person is called a grantor.
A special needs trust is a good idea to establish if you have a child or other close relative that has a severe disability that would prohibit them from working. Setting up a special needs trust is an important part of your estate planning.
No. By setting up a special needs trust, you are keeping the eligibility for Medicaid and Supplemental Security Income (SSI) intact. This is especially important because these disabilities that warrant a special needs trust are lifelong afflictions, and the individual needs to have multiple sources of aid.
The funds in a special needs trust can only be used for supplemental items pertaining to the disability or illness. It must be used to help treat the affliction and the quality of life of the individual. For example, special needs trust funds can be used to buy a television or computer.
Likewise, these funds cannot be used for day-to-day basics, such as groceries, rent, insurance, and other similar items. Using the funds for these reasons could affect the eligibility of the individual’s Medicaid or SSI.
In New York, you can be your own beneficiary. This means you can open the trust for yourself. However, the assets contained therein will be used to reimburse the government for benefits used before the creation of the fund.
Medical bills for chronic illnesses and severe disabilities can become quite high. Without a special needs trust, the individual will find it very difficult to pay these bills. The aforesaid individual probably will not have the knowledge or foresight to acquire the appropriate funds for these purposes. Having a special needs trust fund ensures financial support for them.
No. There is no limit. The amount can be as big or as small as needed. It is important to discuss the amount with an attorney.
A self-settled trust is one of the three types of special needs trusts. This type of trust uses the funds owned by the beneficiary.

A pooled trust is another type of special needs trust. This type of trust is maintained by a nonprofit organization and focuses on many beneficiaries at once.

This is another type of special needs trust whereby the parents, guardians, or loved ones of an individual establish the trust.

A special needs trust is a very beneficial tool. Whether you are worried or not about government benefits, having a special needs trust is still a very smart move to make. Everyone’s situation is different. No one is required to create a special needs trust fund but having one will ensure that the funds are protected.

The sooner the better. Oftentimes, people procrastinate. They wait and they wait, and the longer they wait the more difficult the process becomes. If you have a child with a disability, even if they were born with it, it is always better to begin the process as soon as possible.

If you establish a special needs trust in New York early rather than later, you are helping yourself. You are making sure that the trust has time to grow. Over time, contributions can be added and help the fund grow without fear of penalties. This reserves more time for the fund to become bigger for the individual, which will help them greatly the older they get.

No. It does not matter what disability the person has. It does not matter if they were born with it or not. The special needs trust will always be available to them, and it will always be an option if they don’t have one yet.

Special needs trusts can be complicated. It is necessary to have an attorney who has knowledge and experience to help guide you through the process. Drafting a special needs trust in New York is important. You do not want any mistakes.

Yes. Having a dedicated attorney to help with the special needs trust will ensure that it is worded in a way to avoid misuse of funds. To avoid this unfortunate circumstance, it is important to have clear, concise instructions in the trust. A lawyer will ensure these instructions are drafted and followed.

This is a common mistake for people who try to create a special needs trust in New York by themselves. If a special needs trust is “revocable” then it can be labeled an asset by the government, thereby potentially hurting the threshold of the individual, which in turn can make them ineligible for some forms of government assistance.

An estate planning attorney can help with a special needs trust. Estate planning and trusts work together with each other. An estate planning attorney will be able to help you with the trust, and they will help you navigate all the difficulties that may come about. It will make the process run smoothly.