Taking care of loved ones with special needs trusts

Ensuring that a loved one with special needs receives the level of care and enjoys the quality of life you want for them can be a challenge. Social Security and Medicaid provide benefits that cover most basic needs. In addition to basic health care, Medicaid also provides a number of programs, such as vocational training, that aren't available through any other channel. However, the eligibility requirements for these benefits can be strict, and often don't make allowances for cash contributions from friends and family. Cash gifts intended to help can instead result in disqualification and a disruption in the continuity of care.

A better way through a Special Needs Trust

Creating a special needs trust makes it possible for families to pay for items that aren't provided for by SSI and Medicaid without risking the loss of benefits. By creating a special needs trust, you can provide cash for your loved one to purchase personal items that would otherwise be unaffordable. A special needs trust is the best way to maintain your loved one's current quality of life and level of independence.

In addition to cash, many types of property can be held in a special needs trust, including a business. Stocks, real estate, collectibles, jewelry, and even patents can also be included. When creating a trust, it's important to consult with a knowledgeable attorney about the rules and exemptions regarding benefits, taxes, and administrative regulations.

Appointing a trustee

A trustee is appointed to administer the trust and grants the power to invest its assets as well as sell them for cash to meet the needs of the beneficiary. The primary trustee is often a family member who serves as long as they live. A successor is chosen and named to continue administration of the trust in the event that the primary trustee becomes incapacitated.

What does the Special Needs Trust pay for?

Funds from the trust can be used to pay for a wide variety of services, including caregiving and therapies not covered by Medicaid. Internet and cell phone services, as well as experiences such as concerts, movies, and travel can also be paid for by the trust. The cost of veterinary care for pets is also commonly provided for.

Payments for food or shelter can result in a reduction of benefits, so it's important that the language of the trust makes it clear that it is to be used for supplemental expenses.

How they work

The trust takes effect after it is signed and notarized. It then receives a tax identification number from the IRS. Once it has received that number, you can open a bank account and add cash to fund the trust. If the trust is to be funded wholly or in part with the beneficiary's own money, such as from a settlement from a personal injury lawsuit, your attorney can advise you as to the specific rules that apply, as they are often complicated and differ from state to state.

Turn to an experienced Long Island Special Needs Trust attorney

Special needs trusts are one of the best legal tools available for providing for your loved one in perpetuity. Any assets titled to the trust are not considered part of your estate. While trusted family members can be counted on to help, they can also be subject to unforeseen events such as a lawsuit or a divorce settlement.

All assets held within the trust are protected from creditors and any future claims against your estate. A special needs trust can help secure the same high quality of care for your loved on after you're gone that it allows you to provide today.

No Comments

Leave a comment
Comment Information
FindLaw Network

Let’s Talk.

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

An Elder Law And Estate Planning Law Firm On Your Side.
Futterman, Lanza & Pasculli, LLP | Elder Law & Estate Planning Law Firm

satellite office

By Appointment Only

180 East Main Street
Suite 101
Smithtown, NY 11787

Phone: 631-894-4730
Fax: 631-979-9546
Smithtown Law Office Map

13 East Main Street
Bay Shore, NY 11706

Phone: 631-515-5978
Fax: 631-665-9262
Bay Shore Law Office Map

satellite offices
1050 Franklin Avenue
Suite 302
Garden City, NY 11530

Phone: 631-894-4730
Phone: 516-750-5511
Fax: 516-453-0299
Map & Directions

33 Flying Point Road
Suites 121/122
Southampton, NY 11968

Phone: 631-894-4730
Map & Directions