If you have a child or another loved-one in your life with special needs, especially if you are their primary caretaker, it may be beneficial to consider setting up a special needs trust for that person. There are many ways in which doing so could make a major positive impact, including but not limited to:
–Protecting Eligibility for Public Benefits: Many public benefits, including both Social Security (SSI), and certain home and community benefits through MassHealth or other state Medicaid insurance plans, require that applicants have total assets of less than $2000.00, with very few exceptions allowed. Federally Subsidized Housing Programs, such as Section 8, also base eligibility on applicants’ income.
Because SSI and MassHealth can be prerequisites for many other programs and benefits in the state of Massachusetts, it is especially imperative to preserve continued access for people with special needs.
Assets which are held in a Special Needs Trust are not counted toward total income when determining eligibility for these programs. Thus, placing assets in a Special Needs Trust can protect your loved one from being denied eligibility to these and other vital services.
–Creditor Protection: Assets placed in a well-drafted Special Needs Trust by the parents, siblings, or other benefactors of a disabled person are protected from creditors, including institutional organizations, as well as divorcing spouses.
–Privacy: A Special Needs Trust is a private matter between the Trustee, the Beneficiary, and the creator(s) of the Trust. Unlike, for example, a conservatorship through the Probate Court, a Special Needs Trust is not a matter of public record.
–Asset Management: While many persons with special needs have a high level of independence and live quite well on their own, managing money, especially if it is a large sum, can be stressful for anyone. Regular, steady distribution from a trust may make budgeting easier, and help make money one less thing for your loved one to have to worry about.
If you have a child, sibling, or loved one with a disability for whom you wish to provide continuing financial support, Attorney Melcher can help you to decide whether a Special Needs Trust is right for you, as well as assist in any other legal matters involved in planning for your loved-one’s future.
A Third-Party Special Needs Trust is specifically designed to be used for funds that come from a third party. This means assets are coming from someone other than the person with the disabilities. It can be a stand-alone trust that can receive property from your Will, Living Trust, Life Insurance Policies or other beneficiary designations at your death, and is designed to supplement the needs of the person with disabilities. Its primary function is to enhance the quality of life of a person with a disability.