It’s sad having a child disabled from birth. Even into adulthood, such an individual may still require financial support to be able to attain a considerable standard of living. And it is your wish to provide for them.
Typically, people with special needs in Buffalo, New York and most other states qualify for public benefits, including Medicaid, Supplemental benefits, etc. These benefits usually cover cost of healthcare and other supplemental needs, excluding housing, luxury, etc. But the problem is that one may only qualify if they have a highly limited income source. So if you bequeath funds outright to your disabled loved one, you may ruin their eligibility since the funds you pass will be counted as income. The bequeathal will then be used more or less like a replacement to Medicaid. You clearly don’t want this, which is why you need a Special Needs Trust Lawyer Buffalo NY.
What is a special needs trust?
A special needs trust is a special kind of irrevocable trust used to hold assets for a disabled individual while still making them eligible for public benefits. You will name a trustee who manages the assets on behalf of the beneficiary (the disabled).
So when the child attains 18 year of age, they would be receiving Supplemental Security Income (SSI), Medicaid and other benefits for their basic needs, while the funds from the trust can be used for other needs.
Trusts are complex estate planning documents so you would need expert help from a special needs trust lawyer in Buffalo. We can help you. Simply contact our law office today.
What can the funds in a special needs trust be used for?
The beneficiary of a special needs trust can only use the funds to pay for expenses not covered by Medicaid and SSI, such as:
- Special therapies
- Mechanic beds
- Recreational activities to add quality to your child’s life.
The funds cannot be used for basic needs such as food and shelter, else their eligibility for SSI may be compromised since the funds would therefore be considered income.
Special needs trust funds should not be used for the following expenses:
- Direct cash to the beneficiary
- Regular restaurant meals
- Property tax.
Sine it’s not always easy to discern what to use funds in a special needs trust for, it’s important to seek guidance from a special needs trust lawyer.
Requirements of a special needs trust in Buffalo, NY
You must be very clear in writing the terms of your trust. Special needs trusts cannot be revoked (they are a type of irrevocable trust) so you want to be sure you state explicitly in legally recognized terms how the assets will be used for your disabled loved one. This is all the more reason you should get help from an experienced special needs trust lawyer.
The trust must also conform to all Buffalo requirements for validity.
You must establish the document before the beneficiary reaches the age of 65 (the age of Medicaid eligibility).
As the trustor, you must designate a trustee who will have authority over the trust assets. This person is bound by fiduciary duty to always act in the best interest of the beneficiary.
Note that assets placed in a special needs trust by someone other than the disabled are not subject to Medicaid’s repayment rules or look back period of 5 years. But the disabled person’s assets placed in a trust may be subject.
Advantages of having a special needs trust
- Your loved one will then be able to purchase technology to aid their disability, such as quality wheelchair or hearing aids while still receiving Medicaid for their healthcare costs and basic expenses.
- You have the assurance that the proceeds of the trust will go in for expenses you specify. You would not worry that the funds will be used only for healthcare costs which Medicaid should handle.
- By funding assets into a special needs trust, they become unreachable by your creditors. So even when you have debts more than you have assets, you can provide for your loved one without the assets getting seized.
Special Needs Trust Lawyer near Me Buffalo, NY
Our lawyers care about your peace of mind and the welfare of your loved one. Let us help you to help them. Call us today.