Do you have a child, family member, or loved one with a disability? Whether your loved one was born with their disability or acquired it later in life, they may have become dependent upon the benefits of certain government assistance programs. If this loved one is a potential heir or beneficiary of your estate, you should strongly consider drafting a Special Needs Trust for them.
A Special Needs Trust (sometimes called a Supplemental Needs Trust) allows a disabled beneficiary to receive gifts (and other funds) without losing their eligibility for government benefits. Most government assistance programs require the recipients of their benefits to have a minimal amount of assets in order to remain eligible. If you make a gift in your estate plan to a disabled beneficiary in the form of a Special Needs Trust, the gifted assets will not be considered to belong to the beneficiary in determining their eligibility for government benefits.
With a Special Needs Trust, a beneficiary’s basic support and needs can continue to be met through specific government programs. The trustee of the Special Needs Trust is then able to pay for the beneficiary’s comfort beyond the basic necessities of life. The Special Needs Trust can be used to pay for education, travel, and recreation. It can also provide the disabled beneficiary with spending money so they can enjoy every day activities like shopping or going to the movies.
If you have a child with a disability currently receiving government assistance and have not created a will or trust for your estate plan, strongly consider doing so and making sure that any assets your disabled child receives are put into a Special Needs Trust.
If you want to learn more about Specials Needs Trusts and Estate Planning, give us a call at (805) 966-0282. While this post discusses legal issues, it is not intended as legal advice, and use of this site does not create an attorney-client relationship.