A special needs trust is a type of legal agreement you can make to provide additional financial support to a loved one with a disability or a chronic illness without jeopardizing the benefits they receive from public assistance programs, such as Social Security and Medicaid. It is designed to maximize the resources available to the disabled to improve their quality of life.
Since you can make a special needs trust for anyone eligible, the question is who can benefit from it and whether the benefits are worth the trade-off. Let’s find out!
Benefits of a Special Needs Trust
As already discussed, a special needs trust can be made for anyone eligible for its benefits. An eligible person can be anyone with temporary or permanent special needs or chronic illnesses or may develop special needs someday and is already receiving or will receive, in the future, SSDI or Medicare, or anyone who cannot manage their finances. There may be an exception to state law. Therefore, if you’re planning to start one in New York City, the best is to accompany yourself with a Queens or Brooklyn estate lawyer.
Here’s a brief discussion to understand who can benefit from a special needs trust:
- A person with permanent special needsis anyone with a severely disabling condition, such as blindness, brain damage, chronic mental illness, developmental disabilities, down syndrome, paralysis (paraplegia), etc. Such a person is an automatic beneficiary of government programs and is receiving or will likely receive funds.
- A disabled person who may not need SSI and Medicaid benefits latersince their disabling condition is temporary due to an accident can also benefit from a special needs trust. The trustee can terminate it when they feel it’s needless and in the beneficiary’s best interest.
- A person who may need government assistance at some point since their condition is likely to worsen can also benefit from a special needs trust, giving the trustee the power to terminate it when it’s in the beneficiary’s best interest.
- Someone eligible for Social Security Disability Insurance (SSDI) or Medicaremay also need a special needs trust if they do not qualify for Medicaid or SSI later. The question is whether they get enough funds, for example, for their long-term nursing home care.
- A person who is unable to manage their inheritancemay also benefit from a special needs trust, often called a “spendthrift” trust. Such a trust is usually meant to keep assets out of a beneficiary’s hands and in a trustee’s control. It may include someone with mild autism, attention deficit disorder, bipolar syndrome, mild developmental disabilities, or anyone who may spend the inherited money recklessly.
- Sometimes, a special needs trust is created to protect a disabled loved one with inherited money from being a victim of dangerous people.
These people can be the direct beneficiaries of a special needs trust. It may also benefit the other party contributing to the trust being reassured that the proceeds with go to the stipulated expenses.
Hire an Estate Law Attorney, Brooklyn, New York City!
If you’re planning to create a special needs trust in New York City, hire an experienced Queens Probate lawyer to define the trust’s purpose, terms, and directives to ensure its validity. Contact Ledwidge & Associates, the best Real Property Law firm Manhattan, with expert attorneys experienced in handling special needs trust.
Call +1 718-276-6656 or visit their website for a consultation with an experienced Brooklyn estate lawyer.
Ledwidge & Associates
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