A special needs trust, also called a “supplemental needs trust,” is a valuable estate planning tool. It enables your loved one with a disability, or functional need, to receive financial support without negatively affecting any government or state benefits they are currently receiving. These government or state benefits may include Medicaid or Supplemental Security Income (SSI) and more.
All needs-based government benefits have income and asset limits that your loved one must qualify for, so receiving additional funds or assets could reduce or eliminate their eligibility.
For example, you may have an adult child with autism currently receiving SSI benefits, but you want to give them additional funds to meet living expenses. Your child could be disqualified or receive reduced government benefits if they affect their overall income.
On the other hand, if you pass away and leave her an inheritance or insurance benefits worth hundreds of thousands of dollars, they may no longer even qualify to receive SSI or Medicaid.
However, if you put these assets into a special needs trust for your child, they may still be able to keep their benefits and still receive your planned additional support for the remainder of their lives.
Setting up a Special Needs Trust is a straightforward process, and with the help of a Georgia estate planning lawyer, it usually can be done quickly and effectively. Of course, the size, scope, and details of your estate will contribute to the complexity of this process.
Commonly, the usual legal steps involved in setting up a special needs trust are:
- Determine your exact wishes for your loved one – This is the most vital and detailed step, as it will determine how funds will be distributed.
- Choose a trustee – Your trustee will help manage, invest, and disburse funds for your loved one, so this is an important choice and needs to be made wisely.
- Work with your Georgia estate planning lawyer to create your trust.
- Fund the trust passed on your lawyer’s advice.
- Invest your funds competently that your trust is holding.
Getting the help and professional advice of your estate planning lawyer will always help to ensure your special needs trust accurately dictates what you want for the case of your loved ones and that it will be carried out diligently.
What Are The Main Types of Special Needs Trusts?
Each situation is different, and your estate planning lawyer will help collaborate with you to use the proper trust that fulfills your concerns for your loved one.
Simply put, the three types of special needs trusts are:
- General support trusts – A General Support Trust is usually set up for special needs individuals with many assets. They may not need (or fully get their support from) government health benefits such as Medicare or Medicaid. A General Support Trust maintains and controls those high-value assets and provides for the individual’s needs throughout their life.
- Supplemental Care Trusts – A Supplemental Care Trust (also called a self-settled special needs trust) also is used to support your loved one’s needs, but it’s secondary to the government benefits they receive. Effectively the government benefits will cover your loved one’s needs first, and then the Supplemental Care Trust will cover anything that the benefits do not.
- Pooled Trusts – Pooled Trusts are used for your loved one’s needs but endeavor to continue maintaining their eligibility for government assistance while also holding assets that might have otherwise disqualified them. There are two types of Pooled Trust: Medicaid Payback Trusts and Pooled Account Trusts.
The critical item to note is that whatever type of special needs trust your estate planning lawyer determines is best for your circumstance, it will continue to ensure that your loved one’s needs are continued in full and in perpetuity.
What Can A Special Needs Trust Be Used For?
Most people believe that a Special Needs Trusts can only be used for medical items or for items that are related to your loved one’s disability. However, this is incorrect because “special needs” can be broadly defined. In most cases, Special Needs Trusts define “special needs” as anything that is not provided by your loved one’s public benefits programs.
All public benefit programs are intended to provide for all the basic needs and critical items needed, but no more. They aren’t designed to provide supplemental items that could vastly improve a person’s quality of life. This is a significant reason that a Special Needs Trust is such a valuable tool, as it’s allowed and able to pay for many supplemental items that improve the Trust beneficiary’s overall quality of life.
Special Needs Trusts can also pay for many things, such as a home or modified vehicle, and even include other items such as vacations, computers, electronic equipment, educational expenses, and ongoing monthly bills such as phone, cable, and internet services.
Also, a Special Needs Trust can be used to pay for supplemental care that is not provided by Medicaid, additional medical care, additional therapy, and even things like the differential between shared and private room settings.
In simple terms, a Special Needs Trust can vastly improve the quality of life for the disabled trust recipient and should be thoroughly investigated with your Georgia estate planning lawyer.
Who Is Eligible or Can Benefit From a Special Needs Trust?
Commonly, Special needs trusts are used for people who will need government assistance from the SSI and Medicaid programs their entire lives due to their permanent or severe disabling condition.
However, all persons with a disability qualify for SSI or Medicaid. You may have a condition that normally would make you “disabled,” but you may not be eligible for public benefits if you can still earn a living.
People with blindness, developmental disabilities, Down syndrome, chronic mental illness, physical paralysis, or congenital disabling afflictions such as cerebral palsy or cystic fibrosis are usually always most likely to automatically qualify for government benefits. However, many other physical and mental conditions meet the Social Security Administration’s definition of disability, and many may last a lifetime.
This is where the expertise and experience of your Atlanta estate planning lawyer will be invaluable to you. Your disabled loved one may have missed benefits they should have had, or without the use of a Special Needs Trust, may lose benefits to which they are entitled.
Want To Explore Creating a Special Needs Trust, How Should I Proceed?
Taking care of a relative or loved one with special needs is commonly always a difficult and heart-wrenching task, but a duty that most people lovingly are happy to take on.
When the time comes, however, and you are no longer able to follow this road, your prime concern is that your loved one still receives the best care you can provide.
The Law Firm of Oren Ross & Associates has empathetically, professionally, and successfully helped Georgia families set up Special Needs Trusts as part of their estate plan, so the care you want for your relation is continued as planned. Consult with them today so that nothing is left to chance.
