Protect Those You Love With A Special Needs Trust
All parents want to ensure that their children have the resources they need to live well. When a child has special needs or suffers from incapacity, the need for financial support may be lifelong. Unfortunately, giving a son or daughter even modest financial help may make them ineligible for important government benefits like Supplemental Security Income and Medicaid. Thankfully, there is a solution: The special needs trust.
A special needs trust ensures that a beneficiary with a disability will have their financial needs met and government benefits uninterrupted if a family member, particularly a parent or guardian, leaves them an inheritance. Planning for someone with a disability involves careful thought and preparation, usually in consultation with an experienced attorney. In Little Rock and surrounding areas of Arkansas, you can find the legal help you’re looking for at Jurist Law Group, PLLC. Our attorneys have decades of experience in estate planning and other aspects of elder law, including the creation of special needs trusts.
Assets Are Owned By The Trust But Are Utilized For The Beneficiary
If a parent were to leave an inheritance to their adult son or daughter who is on government disability benefits, it could affect their eligibility to continue receiving those kinds of benefits. It is worth noting that certain property, such as a house and car, do not affect Supplemental Security Income and Medicaid eligibility. However, cash and assets in bank accounts will disqualify a recipient of government benefits. This is where a special needs trust comes in handy.
Instead of transferring property and other assets directly to someone who is on government benefits, a special needs trust is created to serve as an intermediary and placed under the care of a trustee. Since the special needs trust is established under another person’s name (the trustee), Supplemental Security Income and Medicaid do not count the trust as part of the beneficiary’s income and assets. Therefore, the beneficiary would still be eligible for their government benefits while also benefitting from an inheritance, regardless of total the value of assets in the trust.
A Trustee Oversees Asset Distribution
The trustee of the special needs trust will always be in control of the assets in the trust. They have a fiduciary duty to fulfill the trust according to its terms and conditions. Failure to do so can prompt serious legal consequences and ramifications. Since the beneficiary does not have control over the assets, the trustee oversees the distribution of the assets in the trust in a specified manner. For instance, the trustee is not allowed to give money directly to the beneficiary. Instead, the trustee can make purchases and pay for services on behalf of the beneficiary. They could, for example, pay for vacations, home furnishing, recreational activities, clothes, out-of-pocket medical expenses, out-of-pocket dental expenses, and education costs.
Utilizing a trustee has practical as well as legal benefits. For some individuals with special needs, managing their own money can be difficult or even impossible. A trustee can ensure that the assets are used to cover necessary services and amenities as well as the personally fulfilling experiences mentioned above. A special needs trust gives many parents peace of mind that their sons and daughters will be cared for even when the parents are no longer able to provide that care and oversight.
Let’s Make A Plan Together – Contact Our Firm Today
Because these legal instruments are both critical and complex, it is essential to consult with an attorney who has decades of experience with trust formation and administration. That’s why you should contact Jurist Law Group, PLLC. If you are interested in more information about special needs trusts or are ready to create one, contact us to schedule an initial consultation. You can reach out online or call our Little Rock office at 501-400-7355.