Special Needs Trusts

If you have a child that is physically or mentally disabled, are you aware that they cannot receive an inheritance in excess of $2,000 without negating their eligibility for governmental healthcare benefits such as Supplemental Security Income and Medicaid? This is when a family would benefit from a Special Needs Trust.

A Special Needs Trust—or Supplemental Needs Trust—is a provision that provides supplementary, long-term care to the named beneficiary through unlimited assets above and beyond what the government contributes. It outlines what property should be left to the trust since assets are not left directly to the beneficiary in order to circumvent potential issues.

Without a Special Needs Trust in place, the beneficiary would receive only governmental benefits, which is typically considered living below poverty level. Rehabilitation, compensation for personal care attendants, out-of-pocket medical expenses, treatments not covered by governmental benefits, and legal fees are common uses for the trust’s funds. It can also pay for education, vehicles, homes, recreation and vacations—anything that creates a better quality of life for the beneficiary.