If a member of your family has special needs, it is important to you that he or she has financial security. Let’s say for example, that your 19-year-old son, Johnny, suffered serious injuries in a car accident. That the accident resulted in traumatic brain injury and left your child as a paraplegic. Now you are faced with ongoing medical expenses, the need to retrofit your home to accommodate your child’s special needs and a myriad of other costs.
With the help and assistance of your NY estate attorney, a Special Needs Trust can be established for your loved one. Johnny can continue to live at home with you as his primary caregivers. You can be compensated by the trust to provide for his specialized needs and attention which is a 24/7 full-time job.
What is a Special Needs Trust?
Special needs trust are authorized by 42 U.S.C. sec. 1396p(d)(4)(A) and are an estate planning tool that protects funds intended for your special needs loved one, while preserving eligibility for public benefits. The assets of the trust can be used for essentials not covered through entitlement programs, such as private nurses, or therapists, or certain types of medical equipment. The trustee is responsible for the management and distribution of the assets in the trust.
To be eligible for a Special Needs Trust:
• You must be under the age of 65
• The trust must be funded with the individual’s assets (such as a personal injury award)
• You must be disabled
• The trust must be “for the sole benefit of” the disabled individual
• The trust must be created by a parent, grandparent, legal guardian or the Court
Why your loved one needs a Special Needs Trust
If your loved one is receiving public benefits such as, Social Security Supplemental Income, Medicaid, and Section 8 Housing, he or she will lose those benefits if a trust is not established. In the example of Johnny, his personal injury award would have been quickly exhausted by paying bills that Medicaid otherwise would have paid. So special care must be taken, to set aside funds and in setting up the trust.
Your loved one’s Special Needs Trust can be established using assets that already belong to him or her or may be contributed by a third party. Inheritances, lawsuit settlements, or financial gifts are commonly used to fund the trust.
Need advice about a Special Needs Trust? Talk to an NY estate attorney today!
Setting up a Special Needs Trust for your loved one requires a skilled and experienced estate attorney. The NY Law Offices of Bonnie Lawston has helped many clients over the years set up trusts of all types, including Special Needs Trusts. If you need help in setting up a trust for your special needs loved one, contact us online