A special needs trust supplements any benefits the person with special needs may receive from the government without risking their eligibility for government assistance.
People who have special needs often receive assistance from the government in the form of Supplemental Security Income (SSI) and Medicaid. These forms of government assistance are typically only available to individuals that have $2,000 or less to their name, which may not be the case if they come into money through an inheritance. People who are disabled and qualify for SSI have physical and/or mental conditions that result in “marked and severe functional limitations”.
The purpose of a special needs trust is to assist beyond what government programs can handle. Some examples of how the trust can be used include home health aids, rehabilitation, education, transportation and medical or dental care that is not covered by government benefits.
What are the benefits of a Special Needs Trust?
A trust creates a third party entity to assist your loved one after your death by creating a buffer of sorts between the inheritance and the beneficiary. This has the effect of allowing you to leave money to your disabled loved one without risking their right to collect SSI benefits, or risking the money in the trust being taken by the government to cover medical expenses.
There are several different types of trusts that range from one person taking responsibility for distributing funds, to a pooled trust that is run by a non- profit. To discuss your options and whether a Special Needs Trust is right for your family, contact Adkins Law today to set up a consult.
Were you aware that an inheritance can cost your child their disability benefits? Without an estate plan, a child with special needs may be disqualified from receiving benefits, forcing the use of his or her inheritance to pay for care. With an estate plan in place, you can set up a Special Needs Trust that will allow the child to remain eligible for government benefits while using the trust assets to provide more support for your child.