Special Needs Trusts are trusts designed specifically for people with disabilities. The disability could be from birth, an accident or from addiction. One of the benefits of designating a special needs trust is that the assets of the trust are not directly accessible by the beneficiary, and therefore not counted when accessing financial ability for public benefits. Special needs trusts can be created with the disabled person's own money, or they can be created with other people's money, such as parents leaving money to disabled children upon the parents' passing.
The special needs trust can be used for a myriad of things, including purchasing a home for the beneficiary under the right circumstances, special medical services not covered by medical insurance (therapy, wheelchairs, handicap accessible vans, and medical beds), recreational trips, and any services or items that would enhance the beneficiary's life.
A few requirements must be met before establishing a Special Needs Trust:
–The trustee must have absolute control. The beneficiary (or the parents who are passing down in inheritance) must give control of the assets and distribution of the assets to the trustee, and no beneficiary or someone acting on the beneficiary's behalf can demand the assets.
–The beneficiary cannot revoke or amend the trust. The beneficiary can have no say in the trust so as to keep the distance between the assets and the beneficiary. If the beneficiary has control over any part of the assets it will be counted as part of his available resources and his public benefits could be revoked.
–The trustee cannot give cash to the beneficiary. If the beneficiary is receiving Social Security insurance, the trustee cannot pay the beneficiary in cash. If so, the beneficiary would either lose his public benefits completely or lose part of it based on how much cash was received.
A special needs trust can be a sound way to supplement a reduced income during time of disability, but be sure to meet the requirements of the trust or else your public benefits can be cut or even eliminated. Seek the counsel of a law professional when determining whether or not to establish such a trust.
If you would like more information concerning special needs trusts, contact Antelope Valley estate planning law firm Thompson Von Tungeln (TVT) at (661) 426-2499 or visit their website at www.EstatePlanningSpecialists.com.EstatePlanningSpecialists.com is a comprehensive online resource for personal wealth management solutions through wills and revocable trusts. As Board Certified Specialists in Estate Planning, Trusts and Probate as certified by the State Bar of California Board of Legal Specialization, partners Mark E. Thompson and Kevin L. Von Tungeln are expertly equipped to serve clients with the creative, effective and custom solutions they demand.