Is a Special Needs Trust Right for You?

Posted on Dec 11, 2019 in News, Slider

Is a Special Needs Trust Right for You?

2 Things to Know, 2 Things to Do

When Considering a Special Needs Trust

Learn the legal rights of people with special needs, their families and their caregivers before creating a trust.

October was National Special Needs Law Month, which promoted awareness of the legal rights of people with special needs, their families and their caregivers — the perfect time to explore your options. Learn more about what to know and do if you’re considering a trust. 

2 Things to Know

1. What is a special needs trust? Supplemental Security Income and Medicaid are important sources of support for individuals with disabilities, both in benefits and services. In order to be eligible, individuals must meet very restrictive income and resource limitations. That’s where the two types of special needs trusts come in. One, individuals receiving disqualifying income or assets can open a special needs trust for themselves. Or two, by planning ahead and opening a special needs trust, family members can hold assets for the benefit of a loved one while never jeopardizing critical benefits and services. If properly planned, families can continue to support their loved one with a disability long after they’re gone. After meeting the needs of their loved one, resources are retained for further distribution within the family. Distributions from special needs trust can be made to supplement living and health care needs. 

2. How do you establish a special needs trust? Special needs lawyers can work with clients to set up individualized special needs trusts. Pooled trust organizations like Midwest Special Needs Trust can provide another option — especially in serving lower to more moderate-income families — when the assets may be less and yet still affect eligibility for critical governmental benefits and services.

2 Things to Do

1. Make the important decision if a special needs trust is right for your situation. This may involve working with an attorney, tax advisor, case manager, family member or MSNT. By understanding what public benefits are being received, how a special needs trust works, and other considerations, you can make the best decision on whether a special needs trust is needed or if it’s the best option. 

2. Contact your attorney or MSNT directly to establish a special needs trust. MSNT recommends you consult your attorney, but one is not required to establish a trust with MSNT. MSNT trust agreements have been approved by Medicaid and the Social Security Administration and meet all requirements to be considered an exempt asset. 

For more information on creating a special needs trust, MSNT provides an online guide that outlines the process and addresses questions that might arise along the way. 

Additionally, October 21-27, 2019 was Estate Planning Awareness Week — a good reminder of the importance of estate planning and planning for a family member with special needs. If you have a special needs trust already in place, it’s good practice to review these documents annually, at the time of any public benefit review or after a major life event.

A nonprofit organization based in Columbia, MSNT provides unique support for families, particularly moderate- and low-income, by administering special needs trusts for people with disabilities and protecting important public benefits such as Medicaid and SSI. Serving the Midwest region, MSNT establishes trusts for residents in nine states and continues to work with families and individuals wherever they may reside across the U.S.