Experienced Estate Planning Attorneys Providing Knowledgeable Guidance On Special Needs Trust

Caring for a loved one with special needs is a critical act of service. While it is often rewarding, it is also time-intensive and expensive. If you’re currently caring for a child or other loved one with special needs, you may be worried about making ends meet and preserving important sources of financial help from government programs. Establishing a special needs trust may be the solution you’re looking for.

At Feldman & Feldman, Counsellors at Law, P.A., our estate planning attorneys regularly help clients take care of and provide for their family members, including those who may have a disability that makes it difficult or impossible to be fully independent. Their experience in and knowledge of trusts and estate law make our firm the smart choice in special needs planning.

Special Needs Trusts Provide Financial Help While Preserving Benefits

Individuals living with disabilities can greatly benefit from government benefits and services like Medicaid and Supplemental Security Income (SSI). Unfortunately, the income and asset limits required to qualify for these programs are unreasonably low. Even modest financial help provided by family members can result in the person losing access to benefits. No one should have to choose between seeing their loved one impoverished and losing access to critical financial assistance.

Thankfully, there is a solution. A special needs trust contains assets specifically intended to support an individual with special needs. Because the assets belong to the trust, however, they are not considered in income/asset calculations for Medicaid and SSI.

There Are Numerous Ways To Establish A Special Needs Trust

Common types of special needs trusts include:

D4A trusts – These are called “first-party” trusts because they are funded with the beneficiary’s money (and sometimes settlement proceeds or inheritances due to the beneficiary). Upon the beneficiary’s death, any funds remaining in the trust must first be used to pay back any Medicaid lien for benefits received.

Third-party trusts – These are funded with money from someone other than the beneficiary, typically a parent, grandparent or other relative. If the trusts are drafted properly, its assets are not counted as resources to the beneficiary and are not subject to “Medicaid payback” upon the beneficiary’s death.

D4C pooled trusts – These allow funds from a number of different beneficiaries to be placed into one trust, thus allowing the trustee to earn a greater rate of return with trust assets than could be accomplished individually. Funds placed into a pooled trust do not impose a transfer penalty and may be used for the beneficiary’s “supplemental needs.” Pooled trusts can be a perfect solution when establishing a D4A trust is impractical, although any funds remaining in the pooled trust upon the beneficiary’s death must still be used to pay back any Medicaid lien.

Trustees Manage Assets On Behalf Of Beneficiaries

Many individuals with special needs are incapable of managing money. Therefore, giving them assets directly would be unwise even if doing so didn’t have an effect on benefits eligibility.

With a special-needs trust, however, the beneficiary does not manage the funds, nor do they receive direct disbursements. Instead, the special needs trustee uses trust assets to directly pay for services and expenses that benefit the beneficiary, including those related to:

• Housing and utilities
• Transportation
• Meals and clothing
• Education
• Personal enrichment, recreation and entertainment
• Medical and dental care
• Insurance
• Personal care assistance

Those who establish the trust (often parents or other family members) can specify how trust assets are to be spent, ensuring that the beneficiary’s needs are met and no money is wasted or misused.

The Importance Of Working With An Experienced Estate Planning Attorney

All trusts are complex legal entities that require careful construction and ongoing management. They are powerful instruments that can accomplish important goals, but mistakes and omissions in establishing or administering a trust can weaken its effectiveness or cause problems that are time-consuming and expensive to fix.

Our attorneys have decades of experience in estate law and special needs law, and we have helped countless families just like yours. We will guide you through the processes of setting up, funding and administering a special needs trust, and will ensure the end product is one that protects the best interests of the beneficiary.

Learn How We Can Help During An Initial Consultation

Feldman & Feldman serves clients throughout South Florida. To schedule your initial consultation, call our Coral Springs office at 954-228-6074 or reach out online.