Special Needs Trusts: Financial Coverage When You Need It Most

Special needs trusts attorneys are committed to the task of ensuring that people with disabilities have the financial coverage they need to cover any costs that occur both in their daily lives and for any other necessary expenditures that crop up along the way.

 

This can cover anything from hospital bills to education fees, and everything in between. When set up properly, by an experienced attorney, a special needs trust enables a person to receive government disability grants while simultaneously receiving necessary funds from the trust itself.

 

By law, a person cannot receive disability benefits from the government if he or she owns property or has a similar asset which can be used to garner funds in some way. Special needs trusts attorneys help to work around this rule, which tends to be fairly problematic for disabled people who have no real form of income. When funds are placed in a trust, the beneficiary continues to be eligible for Social Security and Medicaid -- two of the most important benefits in terms of one's basic living needs.

 

In its most basic form, a special needs trust is an agreement between three parties: a donor, a trustee, and a beneficiary. The donor, as the name indicates, supplies funding for the trust. The trustee is responsible for carrying out the donor's wishes which, more often than not are outlined in a written document. The beneficiary, quite obviously, receives the funds in the trust fund to use as necessary. Because trusts tend to "outlive" their donors, they are a proper form of estate management. Parents and caretakers of disabled individuals are often concerned about the long-term future of their beneficiaries, so intense attention to detail is necessary during the initial drafting stages of the paperwork.

 

A special needs trust is always geared specifically towards the needs of the beneficiary. All documentation needs to be drawn up in such a way that it in no way compromises the individual's right to receive governmental aid and benefits to cover the most important expenses. Not all special needs trusts are the same, though there are three basic trust types: first-party, third-party, and pooled. Each of these trust types has its own set of benefits.

 

A first-party special needs trust always holds assets or finances that actually belong to the person with the disability. More often than not, these trusts are formed as a result of an accident settlement or through an inheritance. With a third-party trust, the funds belong to a person (or people) other than the individual with special needs.  A pooled fund holds assets belonging to several special beneficiaries in need of financial assistance.

 

A special needs trust attorney is responsible for ensuring that the trust is in order with regulations regarding Supplemental Security Income (SSI). This government program is designed to assist people with special needs who have low or non-existent incomes. Generally speaking, any individual applying for SSI cannot have more than $2000 in his or her name. An attorney with the correct know how can ensure that people with disabilities who do not fall within this bracket still receive the government benefits they need.

 

These trusts are the ideal solution to any financial conundrums that could occur in the later life of a special needs person who might not have the immediate assistance they need to get care when it matters most.

 

Learn more about Special Needs Trusts: 

 Disclaimer: the editor of this website is neither an attorney, nor qualified to provide legal advice. Please seek the advice of an attorney or qualified legal counselor before making decisions regarding the topics discussed on this website.

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