The Importance of Special Needs Trusts

By | 2018-01-29T13:08:05-06:00 July 17th, 2017|0 Comments
Special Needs Trusts are a great tool for protecting your disabled relatives and ensuring their eligibility for valuable Federal Medicaid programs. This article is designed to inform you as to how these trust are created and administered, and most importantly, to inform you of the benefits these Special Needs Trusts. Individuals with certain disabilities can receive federal benefits including money for their support and medical expenses from various Medicaid programs. Medicaid is a system set up by the US government specifically designed to assist low income individuals (this is not to be confused with Medicare, federal health insurance for the elderly). In order to qualify for the various Medicaid programs, individuals must have an income level and resources below certain eligibility thresholds. For the disabled, problems with Medicaid eligibility often arise when parents or other relatives leave an inheritance to their disabled children. The assets inherited by the child very well may preclude them from continued receipt of federal aid. Fortunately, the law allows for these assets to be placed into a trust for the disabled child while still preserving their eligibility for federal benefits. However, certain terms and restrictions must be included in the trust to ensure that eligibility parameters are met. Essentially these trusts allow for the assets in trust to be used only for certain needs of the disabled child. The assets in trust will go toward supplementing government benefits rather than supplanting them. The most common restrictions on the special needs trust include provisions which prevent trust assets from being used for food and shelter of the disabled individual. The goal is to let the federal government continue to pay for these primary expenses. If you or a relative is disabled and would like to discuss your options for using a special needs trust, give me a call at (504) 274-1980 or (985) 246-3020.