Planning for the future of a loved one with special needs requires careful financial and legal considerations. A special needs trust (SNT) ensures that assets are managed effectively while maintaining access to essential government assistance programs like Medicaid and Supplemental Security Income (SSI).
Steps to Establish a Special Needs Trust
1. Understand the Purpose of a Special Needs Trust
A special needs trust is designed to supplement, rather than replace, government benefits. It provides funds for expenses such as medical care, education, transportation, and recreational activities without jeopardizing eligibility for public assistance.
2. Choose the Type of Special Needs Trust
There are three main types of special needs trusts:
- First-Party SNT: Funded with assets belonging to the individual with special needs.
- Third-Party SNT: Funded by family members or other benefactors.
- Pooled Trust: Managed by a nonprofit organization, combining multiple beneficiaries’ funds.
3. Select a Trustee
The trustee is responsible for managing the trust and making financial decisions on behalf of the beneficiary. Choose a reliable individual or professional trustee with experience in handling special needs trusts.
4. Draft the Trust Document
Work with an experienced estate planning attorney to draft a legally sound trust document. This document should outline:
- The purpose of the trust
- The trustee’s responsibilities
- Guidelines for fund distribution
- Provisions for successor trustees
5. Fund the Trust
Assets such as cash, investments, real estate, or life insurance policies can be placed into the trust. Ensure that funding aligns with the beneficiary’s long-term financial needs.
6. Ensure Compliance with Legal and Government Regulations
Special needs trusts must comply with federal and state laws to maintain eligibility for government benefits. Consulting an attorney ensures proper structuring and adherence to regulations.
7. Manage and Monitor the Trust
The trustee must oversee fund distributions, maintain records, and ensure that the trust serves the beneficiary’s best interests. Regular reviews help adapt to changing financial and legal circumstances.
Secure Your Loved One’s Future
Creating a special needs trust requires careful planning and professional guidance. For expert assistance, contact The Eastman Law Firm.
Contact Us Today
Name: The Eastman Law Firm
Address: 4901 W. 136th Street, Ste. 240Leawood, Kansas66224
Phone Number: (913) 908-9113
Website: www.theeastmanlawfirm.com
