When the clocks change it is a good time to update your special needs trust

Don't Forget To Update Your Special Needs Trust

As we approach the time of year when we move our clocks forward, it’s important to remember that this is also an excellent opportunity to revisit your estate planning documents, including your special needs trust. Updating your special needs trust when the clocks go ahead can help ensure that your loved one with special needs continues to receive the support they need, even after you’re gone. In this blog post, we’ll explore why updating your special needs trust when the clocks go ahead is a smart move.

What Is A Special Needs Trust?

Before we delve into why it’s important to update your special needs trust, let’s first understand what it is. A special needs trust is a legal document that allows you to set aside money and assets for the benefit of a person with special needs. These trusts are designed to help individuals with disabilities maintain eligibility for government benefits while still receiving the additional support they need.

Changes in Laws & Regulations - Update your Special Needs Trust

Laws and regulations regarding government benefits and special needs trusts can change over time. Updating your special needs trust when the clocks go ahead can ensure that it is in compliance with any new laws or regulations that may have been enacted since you last updated it. This will help ensure that your loved one with special needs continues to receive the support they need without any interruptions.

Changes In Your Personal Situation

Your personal situation may change over time, and your special needs trust should reflect those changes. For example, you may have acquired new assets or received an inheritance that you would like to include in the trust. Or, you may have had another child who you want to include in the trust. Updating your special needs trust when the clocks go ahead can help ensure that it reflects your current situation and that it continues to meet the needs of your loved one with special needs.

Changes In Your Your Loved One's Needs

Finally, your loved one’s needs may change over time. Perhaps they require additional medical care or have developed a new interest that requires additional funding. Updating your special needs trust when the clocks go ahead can help ensure that it continues to meet the evolving needs of your loved one with special needs.

Conclusion - The Importance Of Updating Your Special Needs Trust

Updating your special needs trust when the clocks spring forward is not just a prudent action; it’s a proactive measure that can safeguard the ongoing support and well-being of your loved one with special needs, long into the future. As time progresses, various factors such as shifts in laws and regulations, alterations in your personal circumstances, and changes in your loved one’s needs can all impact the efficacy and relevance of your special needs trust. Therefore, it’s imperative to conduct regular reviews and updates to ensure that the trust aligns with your current situation and your loved one’s evolving requirements. If you haven’t revisited your special needs trust in some time, the onset of daylight saving time presents an opportune moment to do so. By taking the initiative to review and potentially revise your trust document now, you can proactively address any outdated provisions, anticipate future challenges, and make necessary adjustments to enhance its effectiveness. Don’t underestimate the importance of this task; by staying proactive and vigilant, you can ensure that your loved one receives the comprehensive support and protection they deserve, both now and in the years to come.

Special Needs Trusts Online Can Help!

I am a Special Needs Trust Attorney and I am here to help. I am the founder of a nonprofit corporation to that provides quality information about resources available to families as well as providing affordable Special Needs Trusts and estate planning for families. I have over 20 years of experience helping families just like yours. Find out more information at SpecialNeedsTrustsOnline.com or click here to set up a free appointment.

Source: specialneedstrustsonline.com

January 7, 2023February 12, 2024

What Is the difference between a “First-Party” Special Needs Trust and a “Third Party” Special Needs Trust ?

First Party Special Needs Trust Vs Third Party Special Needs Trust

Special Needs Trusts (SNTs) are an important tool for individuals with disabilities to ensure their financial security. There are two types of SNTs, commonly designated as first-party and third-party SNTs. It is important to determine which type of SNT you have or need, as this depends upon whose property is funding the trust.

If the property funding the SNT originates with the SNT beneficiary, then it must be drafted as a first-party SNT

This type of trust is often used when the beneficiary has received a settlement from a lawsuit or inheritance from a family member. On the other hand, if the property funding the SNT always belonged to someone other than the SNT beneficiary, then it must be drafted as a third-party SNT. This type of trust is typically used when someone other than the beneficiary wants to provide funds for their care and support without affecting their eligibility for government benefits such as Medicaid or Supplemental Security Income (SSI).

First Party Special Needs Trust

A first-party special needs trust is a type of trust that is designed to provide financial support for individuals with disabilities without affecting their eligibility for government benefits. This type of trust is typically funded with the disabled individual’s own assets, such as an inheritance or settlement from a lawsuit. The funds in the trust are used to pay for items and services that are not covered by government programs, such as medical care, housing, transportation, education, recreation and other expenses related to the beneficiary’s disability.

First-party special needs trusts can be useful in many situations. For example, if a disabled individual receives an inheritance or settlement but does not have enough income to cover all of his or her living expenses, a first-party special needs trust can be used to supplement the individual’s income while still allowing him or her to remain eligible for government benefits. Additionally, these trusts can help protect assets from being depleted due to medical costs and other expenses associated with the disability. Finally, they can also provide peace of mind knowing that there will be funds available should something happen to the disabled individual’s primary caregiver.

Frequently Asked Questions About First Party Special Needs Trust Vs Third Party Special Needs Trust

What is the primary difference between a First-Party and a Third-Party Special Needs Trust?

The key distinction lies in who funds the trust. A First-Party Special Needs Trust is funded with the disabled individual’s own assets, while a Third-Party Special Needs Trust is funded by assets belonging to someone other than the beneficiary, such as a parent or grandparent.

What are the eligibility criteria for establishing a First-Party Special Needs Trust?

Generally, to establish a First-Party Special Needs Trust, the individual with a disability must be under the age of 65 and must meet the Social Security Administration’s definition of disability.

How does Medicaid reimbursement differ between First-Party and Third-Party Special Needs Trusts?

Medicaid typically imposes a payback requirement for funds remaining in a First-Party Special Needs Trust upon the beneficiary’s death, while assets in a Third-Party Special Needs Trust may be distributed to other beneficiaries or charities without a payback to Medicaid.

Can a First-Party Special Needs Trust be established by the individual with a disability themselves?

No, a First-Party Special Needs Trust must be established by a parent, grandparent, legal guardian, or the court. It cannot be established by the individual with a disability.

What are some common uses of funds from a Third-Party Special Needs Trust?

Funds from a Third-Party Special Needs Trust can be used to supplement the beneficiary’s government benefits, pay for medical and dental expenses not covered by insurance, provide for recreational activities, and enhance their quality of life without jeopardizing their eligibility for public assistance programs.

Need Information About Special Needs Trusts?

I am Tom Sannicandro, a Special Needs Trust Attorney and I am here to help. I am the founder of a nonprofit corporation that provides quality information about resources available to families as well as providing affordable Special Needs Trusts and estate planning for families. I have over 20 years of experience helping families just like yours. Find out more information at SpecialNeedsTrustsOnline.com or click here to set up a free appointment.

December 30, 2022February 12, 2024

What to do after you have signed your wills and special needs trust

What To Do After You have Signed Your Will And Special Needs Trust

Congratulations! You have taken a big step in protecting your family’s future! Your wills and special needs trust will insure your loved one with a disability will be able to collect government benefits, i.e. Supplemental Security Income, Medicaid, SNAP, etc, and still have the benefit of their share of your estate, stocks, real estate holdings, 401K account, other retirement accounts, and any life insurance policy benefits.

The Steps Of What To Do After You have Signed Your Will And Special Needs Trust

Store your Wills and trust in a safe place in your house, where you store your important papers. An unlocked fireproof file is a great way to store them. You can get one by clicking here. Unlocked because you need to be sure your Personal Representative (Executor) has access to them to give to your lawyer or to file them with the court.
Let your Personal Representative (Executor), as well as the Trustee of the Special Needs Trust, know where they are and how they can get access to them.
Give the Personal Representative (Executor), as well as the Trustee of the Special Needs Trust a copy of the Wills and Special Needs Trust, electronic and or paper copies.
Change the beneficiaries of your retirement accounts, life insurance policies, or other brokerage accounts, for your child with a disability to the Special Needs Trust.
Let relatives know you have created a Special Needs Trust for your child with a disability. This is to be sure if Grandma or Grandpa or Aunts and Uncles, etc. plan on leaving money to your child with a disability in their will, let them know they should leave the portion for the child with a disability to the Special Needs Trust. “to the trustee under The ‘your child with a disability’s name’ Trust for the benefit of your child with a disability’s name’.”
Decide whether you want to fund the trust now.
1. Most people do not fund the Special Needs, it gets funded only after your death with the assets you have designated to go to your child with a disability from your will or as the beneficiary of a retirement account or life insurance policy, etc.
2. Do not fund the trust with assets that belong to your child with a disability. Those funds need to be treated differently with what is called a First Party Trust. Set up an appointment to find out more about this. It is also possible to create an ABLE Account depending on the amount of assets.
3. If you are funding the trust now you need to open a bank account. To do this you need a tax id. You can get one by clicking here to go to the IRS website. (We can do this for you for a fee. ) Once you have the Tax ID you bring that number and a copy of the trust to the bank to open the account.
If you have any questions about any of this contact us.

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November 27, 2022February 12, 2024

What’s the Difference Between SSI and SSDI?

What Is the difference between SSI and SSDI?

The major difference is that SSI determination is based on age/disability and limited income and resources, whereas SSDI determination is based on disability and work credits.

In addition, in most states, an SSI recipient will automatically qualify for health care coverage through Medicaid. A person with SSDI will automatically qualify for Medicare after 24 months of receiving disability payments (individuals with amyotrophic lateral sclerosis [ALS] are eligible for Medicare immediately).

What Is the difference between SSI and SSDI?

The major difference is that SSI determination is based on age/disability and limited income and resources, whereas SSDI determination is based on disability and work credits.

How does Social Security define disability?

Social Security uses a strict definition of disability that relates to your ability to perform work and the projected length of your disability. It requires that you submit medical records to support your application. If you have a short-term or partial disability, you are not eligible for SSI or SSDI.

How do I apply for SSI or SSDI?

You can apply for SSI online only if you are an adult with a disability. SSI applications are not available online for people applying for a child under age 18 with a disability or a non-disabled senior aged 65+. These individuals must visit their local Social Security office or call 1-800-772-1213 (TTY 1-800-325-0778) between 7 a.m. – 7 p.m., Monday through Friday. You can apply for SSDI benefits online at any age. You also can apply by calling Social Security at the number above or at your local office.

How do I apply for SSI or SSDI?

The Supplemental Security Income (SSI) program provides monthly payments to adults and children with a disability or blindness who have income and resources below specific financial limits. SSI payments are also made to people age 65 and older without disabilities who meet the financial qualifications.

You may be eligible to receive SSI monthly payments even if you are already receiving Social Security Disability Insurance or retirement benefits.

Apply for SSI Online Now!

Other Ways to Apply

Apply By Phone

Call us to make an appointment to file your application at 1-800-772-1213. If you are deaf or hard of hearing, you can call us at TTY 1-800-325-0778.

Apply Online

Start a disability claim online (if age 18-64)
Start a child’s disability claim online (under age 18)

More about the program

How SSI Works

Who is Eligible for SSI?

Helpful Information

How SSI Works

SSI is a Federal program funded by general tax revenues (not Social Security taxes). It provides monthly payments to meet basic needs for food, clothing, and shelter. The base monthly federal amount varies depending on your living arrangement and countable income. Not everyone gets the same amount. You may get more if you live in a state that adds money to the federal SSI payment. You may get less if you have other income such as wages, pensions, or Social Security benefits. You may also get less if someone pays your household expenses or if you live with a spouse and he or she has income. You may be able to get SSI if your resources are worth $2,000 or less. A couple may be able to get SSI if they have resources worth $3,000 or less.

Who is Eligible for SSI?

Anyone may apply for SSI. The SSI program provides monthly payments to people who: Are at least age 65 or blind or disabled. Have limited income (wages, pensions, etc.). Have limited resources (the things you own). Are U.S. citizens, nationals of the U.S., or some noncitizens. Reside in one of the 50 states, the District of Columbia, or the Northern Mariana Islands. Exception: The children of military parent(s) assigned to permanent duty outside the U.S. and certain students temporarily abroad may receive SSI payments outside the U.S.

Eligibility

Anyone who believes they meet Federal Disability requirements is eligible to apply. Your family members may also receive benefits if you can no longer work due to a medical condition. You are considered disabled under Social Security rules if: You cannot work due to a medical condition; You cannot do work that you did before; We decide that you cannot adjust to other work because of your medical condition(s); and Your disability has lasted or is expected to last for at least one year or to result in death. People who have worked long enough may also be able to receive Social Security Disability Insurance benefits as well as Supplemental Security Income (SSI) benefits.

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November 26, 2022February 14, 2024

When is a Special Needs Trust Needed?

Have You Wondered When Is A Special Needs Trust Needed?

A special needs trust is needed if your child with a disability is expected to be able to collect Supplemental Security Income, SSI, or some other government benefits, which could include Medicaid, SNAP, or housing benefits, when they become an adult. This would be because your child is unlikely to be able to support themselves by working independently. If you think this is a possibility, and you have assets you would like to leave your child when you die, you should have a Special Needs Trust.

What Is A Special Needs trust?

A special needs trust, also known as a “supplemental needs trust”, is an estate planning tool that enables a person with a disability or functional needs to receive financial support without negatively affecting any means-tested government benefits they’re receiving like Medicaid or Supplemental Security Income (SSI). Because needs-based government benefits have income and asset limits, receiving financial gifts or assets could reduce or eliminate eligibility. This means if you have an adult daughter with autism on SSI benefits and want to give her money to meet her living expenses, she could be disqualified from receiving needs-based government benefits. Likewise, if you die and leave her your Roth IRA worth hundreds of thousands of dollars or any amount that exceeds the asset limit, she could no longer receive SSI or Medicaid. But if you put the assets into a special needs trust for your daughter, she can keep her benefits and receive your financial support for the rest of her life. What can a special needs trust pay for? Money in a special needs trust is meant to be a supplemental resource, meaning it should cover expenses that aren’t already covered by government benefits. More specifically, the beneficiary should use the money for expenses other than food and shelter. You must ensure money is spent in accordance with IRS guidelines, so hold on to receipts or make a spreadsheet to keep track.

Benefits of a special needs trust

Setting up a special needs trust for someone can help you enhance their quality of life and give you peace of mind. These trusts ensure that a person with functional needs will receive the financial support they need throughout their lifetime, whether you’re here or not. Here are a few key benefits of special needs trusts: Your loved one can still receive needs-based government benefits. In some situations, creditors or lawsuit winners can’t access the funds or assets in the trust. Trust funds can be invested by a trustee or financial advisor. You may be able to have control over who inherits the trust when the beneficiary dies. Trusts provide protection against financial abuse, as trustees have a fiduciary duty to act in the beneficiary’s best interest.

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November 20, 2022February 12, 2024

The Top 7 Reasons to Establish a Special Needs Trust

What is a special needs trust?

If you have a child or other loved one with special needs, you may want to establish a special needs trust. A special needs trust is an estate planning tool that can help you provide for the needs of an individual who is disabled without jeopardizing his or her eligibility for government benefits. A qualified attorney can help you establish and administer this type of trust.

Reasons To Establish A Special Needs Trust

Unlike other types of trusts often used in estate planning, the primary goal of a special needs trust is to provide for the needs of an individual who is disabled throughout his or her life. Federal and state benefits are generally available to qualifying children and adults who have special needs. If your child qualifies for government benefits, one of your goals may be to help make sure that his or her eligibility continues into the future. A special needs trust can help you attain this goal. In addition, this type of trust can provide for supplementary care and services for your loved one.

To preserve eligibility for Medicaid

Medicaid, a joint federal-state program, provides medical assistance to those who are disabled and can demonstrate financial need. Children and adults can qualify for Medicaid only if their monthly income and the value of their other assets fall below certain limits, which vary from state to state. Most states set a $2,000 asset limit. In determining eligibility for Medicaid, a state may count only the income and assets that are legally available to the applicant. A special needs trust restricts the beneficiary’s own direct access to the assets in the trust to such an extent that the assets are not considered legally available to the beneficiary. Thus, a special needs trust can protect Medicaid eligibility because assets in the trust are uncountable.

To preserve eligibility for Supplemental Security Income (SSI)

Children and adults with special needs who have limited income and resources often receive monthly benefits from Supplemental Security Income (SSI). These cash benefits can be used for basic needs such as housing and food. But because SSI benefits are need-based, inheriting money can mean that a child with special needs will lose eligibility for this benefit program. By naming a special needs trust as your beneficiary instead of your child, however, assets can be devoted to the care of your loved one. In addition, since SSI recipients are normally automatically eligible for Medicaid benefits, preserving your child’s eligibility for SSI may preserve their eligibility for Medicaid as well.

To provide additional care and services

A special needs trust can be especially useful if you want to provide care and services necessary for your child’s well-being, without supplanting Medicaid benefits. Although Medicaid pays for a number of medical costs, including hospital bills, physician services, and long-term care, it will not subsidize items and services considered nonessential. These may include health-related expenses such as eyeglasses, dental care, rehabilitation services, and home health aide services, as well as personal expenses such as transportation, computer equipment, and vacations. To help confirm that trust assets are not considered legally available to the beneficiary, the trustee must have sole discretion over the distribution of trust income and principal. The beneficiary must have no control over the trust and no right to demand distributions from the trust. The trustee should purchase goods and services directly on the beneficiary’s behalf, instead of giving the beneficiary money from the trust to purchase items needed.

What requirements must a special needs trust meet?

If the trust is intended to supplement, rather than replace, government benefits, it must be properly drafted. Although requirements vary according to state law and the type of special needs trust established, here are some of the rules that apply to special needs trusts in general:

Generally, only a parent, grandparent, legal guardian, or court can set up a special needs trust. The person with disabilities, no matter how competent, cannot be the “creator” of the trust (even if the trust is funded by their personal assets).
Funds in the special needs trust may not be available to the beneficiary.
The beneficiary cannot revoke the trust.
The individual with special needs must be considered “permanently and totally disabled” under SSI criteria. Different rules apply to adults and children.
Under the terms of the trust, the trustee may not be permitted to make payments or distributions that might interfere with government benefit eligibility. Distributions cannot be made directly to the beneficiary.
Special needs trusts may be established as part of a will or during the creator’s lifetime.
Special needs trusts can hold an unlimited amount of funds and funds can be added at any time.

What types of special needs trusts are available?

Although there are many types of special needs trusts, they fall into two general categories: the third-party special needs trust, which is funded with assets belonging to someone other than the beneficiary; and the self-settled trust, which is funded with assets belonging to the beneficiary.

How is a special needs trust typically funded?

In many cases, a special needs trust is established, but not funded, while the parent or other creator is alive. Upon the parent’s death, their will transfers the child’s portion of an inheritance to the special needs trust. The trust (instead of the child) can also be designated as the beneficiary of various assets, such as employee benefits and life insurance policies.

Typically, a special needs trust is funded using:

Life insurance
Cash (including gifts from relatives)
Investments (e.g., stocks, bonds)
Retirement plan benefits (e.g., pension benefits, IRA funds, 401[k] assets)
Personal and real property
Proceeds from a personal injury settlement (applies to self-settled trusts)

What else should you consider for a special needs trust?

Selecting a trustee

A trustee is a person or institution selected to administer a trust and manage its assets. The trustee’s role is to adhere to the terms of the trust document and fulfill its objectives. You may wish to name yourself or another family member as trustee of the special needs trust, or you may wish to name a professional trustee. Another option is to name a family member and a professional trustee as co-trustees.

Providing a letter of intent

If you set up a special needs trust through your will, you might also want to draft a letter of intent to describe how you want your child to be cared for after you’re gone. Although it’s not a legal document, it can provide important information to guardians, trustees, family members, and others involved in the care of your child. The letter may address such issues as your child’s medical needs, daily routine, interests, likes and dislikes, religious practices, living arrangements, social activities, behavior management, and degree of self-sufficiency. Such a letter can prove invaluable to your child’s caregivers and can also make the transition to a new living situation as smooth as possible for your child.

Informing family members

Explain to siblings or other family members why you’re setting up the special needs trust. Although siblings might expect to receive equal inheritances, more resources will probably need to be set aside for the benefit of your child with special needs. Explanations and clear directions now may help avoid family conflicts later.

Setting Up a Special Needs Trust

November 16, 2022February 14, 2024

Watch this video for an overview of special needs wills and trusts.

Below is the powerpoint with live links

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October 27, 2022February 12, 2024

Special Needs Trusts – What you need to know!

What You Need To Know About Special Needs Trusts

If you have questions about special needs trusts, set up a consultation. Your consultation is FREE.

Source of Trust Assets

Based on their source of funding, Special Needs Trusts are categorized either as Third-Party Special Needs Trusts or First-Party Special Needs Trusts. Third-Party Special Needs Trusts are created and funded by someone other than the beneficiary, like a parent, grandparent or sibling. The trust will be established either during the lifetime of the creator or under the terms of the creator’s will. As explained below, a properly drafted Third-Party Special Needs Trust can provide for the special needs of a person with disabilities without jeopardizing his or her eligibility for government benefits. First-Party Special Needs Trusts are funded with a beneficiary’s own property, such as an inheritance or the proceeds from a lawsuit. Although the beneficiary’s own assets will fund the trust, the regulations governing First-Party Special Needs Trusts require that the beneficiary’s parents, legal guardian or the court establish the trust. Another requirement is that the beneficiary must not be over age 65 at the time the trust is funded. This type of First-Party trust is commonly referred to as an OBRA, or (d)(4)(A) trust, taking its name from the federal code section authorizing the trust. (OBRA stands for the Omnibus Budget Reconciliation Act of 1993, and the full statutory cite is 42 U.S.C. section 1396p(d)(4)(A).) In the case of a personal injury claim for the Beneficiary of a (d)(4)(A) Special Needs Trust, before the trust may be funded, most states’ Medicaid Programs must first be reimbursed for those benefits paid prior to the establishment of the Special Needs Trust for medical care necessitated by the wrongful acts that generated the recovery. This “pre-trust lien” may be satisfied only from that portion of the recovery that is specifically allocable to past medical expenses and costs. Transfers of a Beneficiary’s assets to a (d)(4)(A) Special Needs Trust are not penalized for purposes of means-tested benefits. Also, if the trust funds are smaller, the beneficiary may wish to instead create a pooled Special Needs Trust (a (d)(4)(C) trust), which does not prohibit the beneficiary from being the grantor and does impose an age limitation. With a pooled trust, the assets of many individuals are “pooled together” for investment purposes; however, the funds are allocated to each individual beneficiary.

Payback Requirements

A properly drafted trust agreement will address a trust’s obligation to reimburse governmental programs such as Medicaid, SSI or their state equivalent. With Third-Party Special Needs Trusts, the remainder beneficiaries will receive the entire balance of the trust because its assets are not subject to Medicaid payback provisions upon the death of the beneficiary. First-Party Special Needs Trusts are subject to payback provisions that provide Medicaid with a right to reimbursement from the property remaining in the trust upon the death of the beneficiary. If any balance remains after the Medicaid payback, the excess is then distributed to the designated remainder beneficiaries. If the First-Party Special Needs Trust is a pooled trust, in lieu of the Medicaid payback, remaining funds may instead be allowed to be donated to the pooled trust to be used for other beneficiaries of the trust. Per 42 USCA 1396P(d)(4)(C), qualifying pooled Special Needs Trusts include: A trust containing the assets of an individual who is disabled (as defined in section 1382c(a)(3) of this title) that meets the following conditions: (i) The trust is established and managed by a nonprofit association. (ii) A separate account is maintained for each beneficiary of the trust, but, for purposes of investment and management of funds, the trust pools these accounts. (iii) Accounts in the trust are established solely for the benefit of individuals who are disabled (as defined in section 1382c(a)(3) of this title) by the parent, grandparent, or legal guardian of such individuals, by such individuals, or by a court. (iv) To the extent that amounts remaining in the beneficiary’s account upon the death of the beneficiary are not retained by the trust, the trust pays to the State from such remaining amounts in the account an amount equal to the total amount of medical assistance paid on behalf of the beneficiary under the State plan under this subchapter.

Establishing Intent in the Trust Document

To avoid disqualification of a beneficiary for governmental support, applicable federal and state laws strongly suggest that the trust document make clear its intent that the trust assets will supplement, and not supplant or diminish, any governmental benefits to which the beneficiary may be entitled. The trust document should set forth clearly that the Special Needs Trust is not intended to be a basic support trust. Essential Items in Special Needs Trusts The following are essential characteristics of a Special Needs Trust: 1) It must be irrevocable; 2) It must be valid under federal and state local law; 3) It must negate a determination that trust assets are “available resources” of the beneficiary for purposes of Supplemental Security Income (SSI), Medicaid or an equivalent state program; 4) Many state programs also impose the requirement that in order to qualify as a (d)(4)(A) or (d)(4)(C) trust, the beneficiary must be disabled within the meaning of the rules governing Social Security Disability.

What Can the Trust Pay For?

Some sample trust distributions for the Beneficiary that should not affect his or her means-tested benefits, could include:

reasonable compensation of the Trustee, and allied professionals advising the Trustee, e.g. investment manager, attorney, fiduciary accountant
reasonable compensation of care providers, including family members, where appropriate (Medicaid is often resistant to paid family or friends of Beneficiary due to frequent abuses)
medical services and equipment not covered by government programs
domestic and personal care services (housekeeper, grooming, meal preparation)
household costs other than food, mortgage or rent, real property taxes, heating fuel, gas, electricity, water, sewer and garbage removal
pre-paid funeral and burial arrangements (however, if the Beneficiary dies before arrangements have been pre-paid, no payments for same may be made from the Special Needs Trust until after Medicaid pay-back is fully satisfied)
computer or augmentative communications devices, and internet service
television or other electronic equipment
apparel, including maintenance and repair of same
one vehicle used for transporting the Beneficiary (not including a purely recreational vehicle)
membership in recreational clubs, cultural institutions
professional services: attorneys, accountants, claims processors, advocates, coaches
academic or recreational courses or classes
home decor, furniture, furnishings, appliances
dry cleaning and laundry services and supplies
fitness equipment and club membership
auto maintenance and supplies
home security alarm and monitoring service
yard service and maintenance
insurance for home, auto, liability
linens, towels, bedding
personal care items and supplies
music lessons, cost of instruments
non-food groceries and sundries
educational needs and supplies
over-the-counter medications
pet, service animal and supplies, veterinary services
sporting goods and equipment
stationery, stamps
telephone service and equipment
therapies not covered by benefits programs
tickets to cultural or sporting events
transportation costs (bus, subway, paid driver)
cable TV
vacation for Beneficiary and one attendant
catch-all: “such uses and purposes as the Trustee deems appropriate under all circumstances” for the sole benefit of the Beneficiary

Choosing a Trustee

The selection of the trustee for a Special Needs Trust is an important aspect of special needs planning. Some of the characteristics of a trustee for a Special Needs Trust should include:

Experience to manage the assets pursuant to the prudent investor rules.
Where a pooled trust is involved a non-profit organization with trust powers must be the trustee.
Knowledge to exercise its discretion under the terms of the trust agreement to make payments on behalf of the beneficiary for supplemental, nonsupport disbursements.
The ability to avoid any conflict of interest that might occur if a family friend or family member were to act as trustee.
Skills to maintain clear and accurate financial records which, when necessary, can be used to prepare annual court accountings.
A trustee who will take a friendly and caring interest in the beneficiary.

Need Information About Special Needs Trusts?

I am Tom Sannicandro, a Special Needs Trust Attorney and I am here to help. I am the founder of a nonprofit corporation to that provides quality information about resources available to families as well as providing affordable Special Needs Trusts and estate planning for families. I have over 20 years of experience helping families just like yours. Find out more information at SpecialNeedsTrustsOnline.com or click here to set up a free appointment.

July 23, 2022February 12, 2024

Why Should You Create a Special Needs Trust for Your Child?

Why should you create a special needs trust?

A special needs trust allows parents to set aside funds for medical expenses, education costs, and other things that would be difficult to pay for without one. The trust itself does not receive the money; instead, it distributes the money to the beneficiary.

The best thing about creating a SNT is that it allows parents to protect their children from being taken advantage of financially. If you create a trust before your child turns 18 years old, then you can ensure that his or her assets go directly to the person who cares for him or her. In addition, if you die while your child is still under age 18, then the trust will take effect after your death.

A SNT allows parents to set aside funds for their children’s future health care needs. The trust is funded by the parent(s), who then designate which medical professionals will be responsible for providing care. In addition, the parent(s) can specify what level of care should be provided. For example, if the parent wants to ensure that his or her child receives the best possible treatment, the parent might choose to fund a specialized facility. If the parent prefers to provide less expensive care, the parent could choose to fund a community hospital.

A Special Needs Trust allows parents to set aside funds for their children’s future care. The trust is usually funded with life insurance policies, annuities, bank accounts, stocks, bonds, real estate, and other investments. Parents can choose from several different types of SNTs, depending on what type of care their child requires. For example, if your child has a physical disability, such as cerebral palsy, then you might want to create a Living Trust. If your child has a mental health condition, such as autism, then you might consider creating a Health Care Proxy.

Special Needs Trusts Online Can Help!

I am a Special Needs Trust Attorney and I am here to help. I am the founder of a nonprofit corporation that provides quality affordable Special Needs Trusts to families. I have over 20 years of experience helping families just like yours. Find out more information at SpecialNeedsTrustsOnline.com or click here to set up a free appointment.

June 17, 2022February 12, 2024

Massachusetts Special Needs Trust

The Importance of Special Needs Trusts In Massachusetts

What is a special needs trust?

A special needs trust is simply a legal document, an advantageous way to set aside money for a person with a disability.

The trust is intended to help preserve funds for a person with a disability, and enhance the person’s quality of life while protecting his or her eligibility for public benefits, such as Medicaid and Supplemental Security Income (also known as “SSI”).

A 1993 federal law permitted the creation of special needs trusts. The policies that must be followed in creating and administering them are detailed by the Social Security Administration.

Special Needs Trust Administration

Lifetime Security for Your Disabled Child Establishing a well-funded Special Needs Trust (SNT) for a child with a disability in Massachusetts is an important part of providing them with a lifetime of safety, security, and quality of life after you are gone. Money, managed well, means options, choices, and a better life.

How Can Special Needs Trust Funds Be Used?

Many trustees mistakenly believe that a Special Needs Trust can only be used to pay for medical goods and services or other items that are directly related to the beneficiary’s disability, however, if an SNT is well-drafted, that is not the case. Special Needs Trusts can be used to pay for just about anything that benefits the beneficiary, such as home and vehicle maintenance, vacations, computers, and other electronic equipment, education expenses, or monthly phone, cable, and internet services. It can be used to pay for things like rent, however, this reduces the amount of SSI benefit the beneficiary receives.

Precautions for SNT Trustees

It is important to note that there are technical requirements that must be met while serving as a trustee.

You must follow all of the terms and instructions in the trust document, even if they are more restrictive than public benefits law requires.

Trust assets for the beneficiary must be used in ways that do not affect the beneficiary’s public benefits.

Only beneficiaries of the trust may benefit. For a self-settled d4A Trust, that means just the disabled individual and for third-party SNTs, it means only those the trust document states may benefit.

The trust must be treated with the utmost respect. The trustee should not borrow from the trust nor commingle the trust assets with the trustee’s personal assets.

Administering a Special Needs Trust can be complicated and confusing, and making the wrong decision can be problematic. We are Special Needs Trust administration experts who provide trustees with the reliable advice they need to ensure the best quality of life for the trust’s beneficiary.

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Special Needs Trusts Online Can Help!

I am a Special Needs Trust Attorney and I am here to help. I am the founder of a nonprofit 501(c)(3) corporation that provides quality affordable Special Needs Trusts to families. I have over 20 years of experience helping families just like yours. Find out more information at SpecialNeedsTrustsOnline.com or click here to set up a free appointment.