Estate planning is very important regardless of your age, gender, or how fat your bank account is. This plan becomes crucial when you have a loved one with special needs. Creating the right plan means you can sleep well knowing that you have done all in your power to protect them even when you aren’t there anymore.
A special needs trust is simply an estate planning component that lets you protect your disabled loved one without hindering their chances of qualifying for Medicaid, Supplemental Security Income (SSI), and other government funded benefits.
Trying to create an ideal plan for the future can be very difficult. But that is why there are attorneys to assist you along the way. Whether you need to create a special needs trust for your loved one, or if you need one and have questions, this article will provide the answers you se.
Special Need Trust
A special need trust is almost similar to the trust you know. But, there exist a huge difference. A special need trust is a legal arrangement and fiduciary association that allows a physically or mentally incapacitated individual or an individual with chronic illness to obtain income without diminishing their eligibility for the public assistance disability benefits provided by Social Security, Supplemental Security income, Medicare or Medicaid.
In a fiduciary relationship or association, an individual acts in the best interest of an individual or individuals to manage assets.
A special needs trust is a common technique for individuals who want to assist someone in need without risking the person’s eligibility for schemes that requires their income or assets to stay at a particular limit.
How does a Special Needs Trust Works in Bronx City?
A special needs trust covers a portion of an individual’s financial needs that are not covered by public assistance payments. The assets present in the trust do not count for the purpose of being eligible for public assistance, provided they are not used for some food or shelter expenses. Proceeds from a special needs trust are most times used to settle medical bills, pay caretakers, transportation costs, including other approved expenditures.
The trustowner will choose a trustee who will control the trust. This individual will also supervise its management and the distribution of funds. Assets belonging to the disabled person that is held in the trust may be prone to Medicaid’s repayment rules. However, assets provided by third parties, like parents, are not. This type of trust is sometime regarded as “supplemental needs trust.”
Setting Up a Special Needs Trust
First off, you need to set up the trust document. You don’t need the assistance of an attorney to create a simple no-frills special needs trust, and having one that you created yourself is far better than not having one at all.
If you need a personalized trust, that is one designed to your specific situation, contact our office for assistance.
In the trust document, the individual creating the trust (usually regarded as the grantor or settlor) puts property in the possession of another individual (trustee) whose duty is to manage the trust. Normally, the grantor of a special needs trust designate himself or herself as trustee and another trusted individual successor trustee.
The grantor serves as trustee until he or she dies, becomes incapacitated, or resigns at that period the successor trustee takes over. Each individual who serves as trustee is bounded by law to adhere to the terms of the trust document to use the property for the benefit of the individual (beneficiary) with special needs, designated in the trust document.
If you need help to set up a special needs trust or you have questions that you would love to ask an experienced attorney, don’t hesitate to contact our office. We boast of some of the best special needs trust attorneys and they are willing to provide you with the help you need.
