How Do Trusts Help People?
A trust is a legal document that outlines the terms and conditions of how property will be managed and distributed. Trusts can be used for a wide variety of purposes, but one of the most common is estate planning. When you create a trust, you can designate someone to manage your property and finances while you’re alive, and then distribute it to your chosen beneficiaries when you die.
Trusts can be especially helpful for people with special needs. If you have a child or loved one who requires extra care and assistance, you can create a special needs trust to ensure that they will always be taken care of financially. This type of trust allows you to appoint a trustee who will be responsible for managing the beneficiary’s financial affairs and ensuring that their needs are met. There are various types of trusts including special needs trusts.
What Is a Special Needs Trust?
A special needs trust is a type of trust that can be used to provide financial support for someone with special needs. The beneficiary of this type of trust is typically someone who is disabled or has a chronic illness. This type of trust can be used to cover the costs of essential care, such as medical expenses and housing.
One of the main benefits of a special needs trust is that it allows the beneficiary to maintain their eligibility for government benefits, such as Medicaid and Supplemental Security Income (SSI). If the beneficiary were to inherit money directly, they would likely become ineligible for these programs. However, by placing the money in a special needs trust, the beneficiary can still receive government benefits while also having access to additional funds.
There are two main types of special needs trusts:
- A first-party trust is funded with the beneficiary’s own money, such as through an inheritance or personal injury settlement. This type of trust can protect the beneficiary’s eligibility for government benefits like Medicaid and Supplemental Security Income (SSI).
- A third-party trust is funded with money from someone other than the beneficiary, such as a parent, grandparent, or other relatives. This type of trust can be used to supplement the beneficiary’s government benefits and provide for additional needs and expenses.
How Can Hiring an Estate Planning Lawyer Help Me?
An estate planning lawyer can help you create a comprehensive plan for your estate. This plan will take into account your current assets and liabilities, as well as your future goals. The lawyer can help you determine which assets to put into the special needs trust and how to distribute those assets among your beneficiaries.
When Should I Contact a Lawyer?
If you’re considering creating a special needs trust, you should contact an experienced estate planning lawyer. The lawyer can help you understand the benefits and drawbacks of this type of trust and determine if it’s the right option for you. The lawyer can also help you draft the trust document and ensure that it meets your specific needs and goals. Call us today at (501) 891-6000 to get the legal help you deserve.