Limitless Learning

Special Needs Require Special Plans

Having a comprehensive estate plan is important for everyone, especially those with children or other family members who are disabled or have special needs. Most people with special needs will depend on public government benefits in their lifetime, including Medicaid or Supplemental Security Income (SSI). These public benefits are determined based on a person’s “means,” meaning there is a strict limit an individual can have in assets and income. When a person is receiving government benefits and has an increase in assets, the government benefits are threatened, and the individual may be disqualified from receiving the benefits.

When discussing your estate plan and leaving a special needs child or other special needs family member as a beneficiary in your will or trust, you must make sure there is specific language to allow the inheritance to go into a Special Needs Trust (SNT) for the benefit of the special needs individual. This will ensure that any government benefits the individual is receiving are not affected.

There are multiple types of SNTs (also referred to as Supplemental Needs Trusts). The three types I will be discussing in this month’s issue as well as the next two months are Testamentary Special Needs Trusts, First Party Funded Special Needs Trusts and Third Party Funded Special Needs Trusts.

A Testamentary Special Needs Trust allows a person to create a SNT within their will or trust to benefit the special needs individual while protecting the individual from accessing government benefits. The Testamentary SNT does not go into effect until the grantor dies. The Testamentary SNT is revocable until the grantor’s death, and then it becomes irrevocable. Additionally, there is no government pay back provision and the successor beneficiaries can be any person or entity.

All SNTs must follow federal and state law. If you are thinking of leaving a beneficiary with special needs in your will or trust, it is important to discuss your options with an experienced estate planning and special needs planning attorney.

Danielle Feller is the lead estate planning attorney at Daly Mills Estate Planning. She is a native of Mooresville, an AV Preeminent Rated attorney in Estate Planning, Rising Star Super Lawyer and is published in a chapter with Wealthcounsel’s second edition of Estate Planning Strategies, Collective Wisdom, Proven Techniques. Give Feller a call today for a consultation at 704-878-2365 or visit www.DalyMillsEstatePlanning.com.

Danielle Feller Give Danielle a call today for a consultation at 704-878-2365. You can also visit our website at www. DalyMillsEstatePlanning.com.