If you have a loved one with special needs, they likely benefit from government assistance. Some of these benefits may include SSI or Medicaid. In many cases, an individual needs to have a certain amount of assets in order to receive assistance. If you leave your loved one assets in your will or in a trust, they may no longer qualify for government assistance. Luckily, there are ways to avoid this. With the help of a special needs trust, you can ensure that your loved one is cared for and still receiving their government benefits. Read on to learn more.
Who Can Benefit From a Special Needs Trust?
There are many different individuals who may need the help of a special needs estate plan. This includes those who cannot live independently because they have certain conditions, such as autism or Down Syndrome. Others who may need this plan can include individuals with a progressively debilitating disease, such as Parkinson’s, Alzheimer’s, or ALS.
Types of Special Needs Trusts
In the state of New York, there are three main types of special needs trusts that can be created for a loved one:
- Self-Funded Special Needs Trusts: This trust is self-funded with assets owned by the trust beneficiary. They are commonly required when a disabled individual received a settlement from a personal injury action or inheritance from a loved one. This is also used for divorce alimony, property division, and child support payments for a child with a disability.
- Third-Party Special Needs Trusts: This trust can be created by another person for a beneficiary. It can be made during an individual’s lifetime or in the event of a death, as they are generally funded by life insurance. Relatives such as grandparents, siblings, aunts, uncles, and friends can make gifts to this trust.
- Pooled Special Needs Trusts: This trust is also funded with assets owned by the trust beneficiary. They are established and managed by nonprofit organizations. The assets are pooled together for investment purposes. However, the nonprofit organization manages a sub-account for the beneficiary. An individual with disabilities can establish a pooled trust sub-account on their own, which is why this is a common choice for beneficiaries who have no living relatives or guardians.
If you have any questions or concerns about creating a special needs trust, contact our experienced firm today.
Contact our Firm
If you or a loved one needs assistance creating an estate plan and wish to speak with an experienced attorney, contact the Law Office of Andres D. Gil, PLLC today.