In the field of estate planning there are many different tools that can be utilized. As they say, you want to use the right tool for the right job. If you take the proper steps, you can provide for each person on your inheritance list in the optimal matter. With this in mind, we will explain the value of special needs trusts.
Many people with disabilities are enrolled in the Medicaid program. Medicaid is a health insurance program that is jointly administered by the federal government along with each respective state.
Some people with disabilities require care and treatment that could cost millions of dollars over the course of a lifetime. Medicaid coverage is invaluable to these people.
Medicaid eligibility is based on financial need. If someone who was enrolled in the program was to come into a significant sum of money, his or her eligibility could be lost.
This is why you must tread lightly when you are leaving an inheritance to someone who has a disability.
Special Needs Trust
You could use a special needs trust to leave an inheritance to a loved one with a disability who is relying on Medicaid benefits. These trusts are alternately referred to as supplemental needs trusts.
The trustee that you name in the trust agreement will administer the resources that have been conveyed into the trust. The trust technically owns the assets. The beneficiary does not directly own the assets, and the beneficiary cannot handle the funds.
Many people who are qualified for Medicaid also receive some monthly income through the Supplemental Security Income program. A person with a disability may have needs that are not covered by these government benefit programs.
With a special needs trust the trustee can use the trust’s assets to satisfy the supplemental needs of the beneficiary. These would be needs that are not being met by Medicaid or SSI.
Free Report on Special Needs Planning
We have prepared a series of special reports on a number of different estate planning and elder law topics. One of the reports is devoted to the subject of special needs planning as it applies to minor children.
The report is available to our readers free of charge. If you would like to obtain access to this valuable report, click the following link: Special Needs Planning Report.
Schedule a Special Needs Planning Consultation
To effectively plan your estate you should understand all of your options. There is no one size fits all estate plan, because every family is unique.
Personalized attention is key. If you would like to discuss special needs planning with a licensed attorney, we can help. Our firm offers free consultations to people in the Quad Cities area including: Davenport, Bettendorf, Rock Island, and Moline and you can request an appointment through the contact page on this website.
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- Attend a FreeEstate Planning Seminar - December 14, 2016
- Can Medicaid Take My Home? - August 19, 2014