Special Needs Trusts: What to Know

  • Posted on: Dec 12 2019
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The point of an estate plan is to provide for our loved ones, whether it be when we become incapacitated, or upon our death. Each of us wants to know that our interests are protected and that our loved ones are provided for. If we become ill we want to know that we will be cared for – or not cared for – as we wish, when we are unable to legally provide our wishes. Providing for a descendant or loved one is very important, but even more so when he or she has a disability. 

Although the U.S. government treats people with disabilities as adults upon the age of 18 when an individual becomes disabled prior to the age of 22, he or she may receive Social Security Income (SSI) benefits if the worth of their assets does not reach $2,000 and their income does not exceed the amount of money that they would be receiving under SSI benefits. 

What Are Special Needs Trusts?

Special Needs Trusts, commonly referred to as Supplemental Needs Trusts, can be held in a Revocable Living Trust or can be created as its very own entity. Other individuals may contribute via annual gifts or through their own Living Trust.

Regular trusts and special needs trusts differ in quite a few ways. A special needs trust is designed to provide for a variety of needs. SSI benefits are for the purpose of food and shelter, while a Special Needs Trust’s trustee may use the money to purchase things such as toiletries, wheelchairs, vans, and caregivers without a reduction in SSI benefits.

If a trustee uses the money to provide the beneficiary of the trust with food or shelter, their SSI benefit will be reduced. Alternately, when an individual receives the benefits of a retirement plan while also receiving SSI, it can reduce or even eliminate the latter. When an SSI beneficiary also receives an inheritance, he or she will lose SSI benefits until that money is gone. 

The Law Offices of Brian L. Fox, APLC Help Individuals in CA Who Wish to Create a Special Needs Trust

When designing a Special Needs Trust, it is imperative to do so in a manner that serves to protect the interests of the beneficiary with the disability. This is why it is so important to consult with a knowledgeable and experienced California estate planning and probate attorney who understands. 

If you or a loved one is in need of a Special Needs Trust or other Estate Planning document, the Law Offices of Brian L. Fox, APLC can help. We understand the importance of protecting what really matters. We will help you to protect your interests and decrease the stress on your family and friends when you pass. To learn more or to schedule a free consultation, call us today!

Posted in: Wills and Trusts