Should You Have a Special Needs Trust?

Special needs trusts are available to financially provide for individuals — typically children — who have a mental or physical disability. If you think your loved one may need additional protection after your passing, a special needs trust may be a wise decision for your estate plan.

Who can benefit from this type of trust?

Individuals who need long-term assistance with a disability can be protected through a special needs trust. They may allow beneficiaries to receive their inheritance while maintaining access to income-contingent and asset-contingent benefits such as Medicaid and Supplemental Security Income (SSI). If the beneficiary were to inherit a large sum without the use of a special needs trust, these benefits could cease.

Many people with disabilities are not able to have a job that can provide them with insurance coverage; therefore, having a special needs trust allows them access to health care while receiving the financial assistance they need.

Creating a special needs trust

If your loved one could benefit from a special needs trust, you should consult an attorney to craft a legally binding document outlining the management of the funds. Through creating a trust, you transfer ownership of set assets to a trustee, who is responsible for supervising the funds in accordance with your instructions and for the sake of the beneficiary.

There are some special considerations to remember when appointing a trustee for a special needs trust. It is essential the trustee is an accountable and honest person, as special needs trusts arguably involve more responsibilities than standard trust management. Trustee duties may include spending assets on behalf of the beneficiary and staying up to date with Medicaid and SSI laws to ensure the beneficiary remains eligible for benefits.

If you would like to explore your options for creating a special needs trust, meet with a knowledgeable Tampa estate planning lawyer at BaumannKangas Estate Law.