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Planning by parents can make all the difference in the life of a child with a disability, as well as that of their siblings who may be left with the responsibility for caretaking, on top of their own careers and caring for their own families.
Supplemental Needs Trusts
Special needs trusts (also known as “supplemental needs trusts”) are an important component of planning for a child with a disability, even though the child may be an adult by the time the trust is created or funded.
These trusts allow a beneficiary with a disability to receive inheritances, gifts, lawsuit settlements, or other funds and yet not lose their eligibility for certain government programs, such as Medicaid and Supplemental Security Income (SSI). The trusts are drafted so that the funds will not be considered to belong to the beneficiary in determining their eligibility for public benefits.
What a Special Needs Trust Can Pay For
Special needs trusts are designed not to provide basic support, but instead to pay for comforts and luxuries that could not be paid for by public assistance funds. These trusts typically pay for things like education, recreation, counseling, and medical attention beyond the simple necessities of life.
Three Types of Special Needs Trusts
There are three main types of special needs trusts: the first-party trust, the third-party trust, and the pooled trust. All three name the person with special needs as the beneficiary, but they differ in several significant ways, and each type of trust can be useful in its own way.
At Ericson, Scalise & Mangan, we have experience working with individuals with special needs and with their families to plan for the future. Reach out to us for guidance.
Do you have questions?
Count on your experienced team at Ericson, Scalise & Mangan, PC to provide you with sound guidance for your Estate Planning, Elder Law, Real Estate, Probate, Trust & Estate Administration, and other legal needs. For assistance, contact us today at 860-854-3809, or email us at info@esmlaw.com.
