If you have a special needs child or adult in your family you undoubtedly worry about being able to provide for them after you are no longer here. Special care must be taken when including a special needs loved one in your estate plan because a beneficiary can actually lose much needed assistance if they receive a direct gift from a well-meaning family member. Often, the answer is to create a supplemental needs trust.
Fortunately, many special needs children can grow up to live relatively independent lives with the assistance of many of the state and federal benefit programs designed to help them achieve independence. Programs such as Medicaid, Supplemental Security Income (SSI), and public housing, however, may not completely cover a special needs individual’s living expenses. Contributing to those expenses while you are alive is relatively simple; however, gifting money or assets in your estate plan is a bit more complicated. The reason for this is that most assistance programs have very low income and asset limits that cannot be exceeded by a participant. Therefore, simply gifting assets in your Last Will and Testament directly to your special needs loved one could actually cause him or her to lose eligibility for much needed assistance programs. Creating a supplemental trust is a common solution.
A supplemental needs trust, also referred to as a special needs trust, is a specialized type of trust that allows you to leave assets to a beneficiary under a physical or mental disability, or an individual with a chronic or acquired illness, without jeopardizing eligibility for assistance programs. Those assets are then used to “supplement” the care provided by state and federal assistance programs. Assets may only be used for specific things and then only if the trust is properly drafted. Specific language must be used in a supplemental needs trust for the government to recognize the trust as a special needs trust. For this reason it is imperative that you work with an experienced special needs planning attorney to ensure that your trust will accomplish the intended goals and objectives.
If you have additional questions or concerns about special needs planning, or estate planning in general, contact the experienced Missouri estate planning attorneys at Amen, Gantner & Capriano, Your Estate Matters, LLC by calling (314) 966-8077 to schedule an appointment.
- Show Your Love by Creating an Estate Plan - March 21, 2023
- What You Need to Know About SECURE Act 2.0 - March 14, 2023
- The Lessons from Lisa Marie - March 7, 2023