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Trust Options for those with Disabilities in Marco Island

Special Needs Child

Estate planning isn’t always as simple as making a will. For those who are parents of a disabled or special needs child, establishing a trust for the child is an essential part of their estate planning. There are many options for trust planning for Marco Island residents, but for an airtight legal document and thoughtful planning that takes your unique circumstances into consideration, choose The Mattar Firm.

Trusts For Those With Disabilities

A savvy estate planning attorney can help you create a living trust. For those with disabilities or those who are caretakers for someone with special needs or disabilities, a trust can help ensure that their medical needs are covered and they’re able to pay for assistance with daily living needs. These trusts are referred to as Special Needs Trusts or Supplemental Needs Trusts. The beneficiary of the trust can retain their eligibility for government benefits like Medicaid and Social Security Income while having their supplemental needs financed by the trust.

Special Needs Trusts are divided into two different types: Self-settled and Third Party.

Self-Settled Trust

These are created and funded with assets awarded to the beneficiary. It may be created when damages are paid to an injured person, from an accident, medical malpractice, or other personal injury settlement. The settlement may have been a result of a verdict that caused the person’s disability, but this isn’t always the case.

The trust can be used to supplement the government entitlements of the disabled person. A self-settled trust enables the person to retain their benefits, as the beneficiary of the trust does not have control over or access to the funds in the trust. Instead, the trust is managed and funds allocated by a trustee who makes decisions on behalf of the trust. The trust manager exercises broad discretion to determine care options for the recipient, including treatment for medical needs or occupational and physical therapy, housing or assisted living residence, and even job training and vacations.

Self-settled special needs trusts can be exempt from consideration as assets when applying for government benefits. However, once the recipient of the trust dies, then the truth must pay the government back from the benefits received.

In order for a self-settled special needs trust to be exempt as an asset for benefits qualification, it must pay back the government for services provided if there is anything left in the trust when the beneficiary with a disability or special needs dies. To be clear – generally, self-settled trusts aren’t able to be passed to an heir after the beneficiary dies, unless the funds remaining exceed the money owed to the government.

Third Party Trust

These are created on behalf of someone with special needs, usually a parent or guardian, to benefit the minor child or disabled person. Many parents of a special needs child worry about what will happen to their child after their death. This is a legitimate worry, but a third party trust established for the child can greatly affect their quality of life after you pass. The trust can help supplement government benefits that the child receives, similar to the self-settled trust.

Establishing a trust for your disabled child can ensure that they retain the government benefits that they’re entitled to, including Social Security and Medicaid. If you opt to leave assets to the special needs child in a will, the lump sum inheritance will likely mean that government benefits cease, as the child will no longer be eligible. The child will have to pay for their medical expenses, care housing, therapy, and general expenses such as room and board in a group home. Until their inheritance is exhausted, the child will have to use it to fund all of their needs. Once the money runs out, the child may be re-eligible for government benefits. However, there would be no supplemental funds for additional needs. This can affect paying for education or occupational therapy for the child to receive training to hold a job. Other needs, from over-the-counter medication to books and clothing and even trips to visit family and friends will likely be unaffordable for the child, as their government benefits won’t cover this.

Instead of either disinheriting their special needs child or giving the assets and inheritance outright to them, you as parents can opt to establish a trust for the child. This can be part of your general estate planning, which a good attorney can help you with. The trust can pay for housing and a personal care attendant for your child, for example, and ensure that they’re able to live comfortably. Choosing a lawyer that understands the law as it pertains to government benefits and eligibility is vital to ensure that your child’s trust benefits them.

It’s important to consult with your estate planning attorney when planning a trust for a special needs child or a disabled loved one. Navigating the law and government benefits eligibility can be tricky, and you’ll want someone like The Mattar Firm on your side. Contact The Mattar Firm today if you or someone you know is trying to qualify for guardianship in Marco Island for a special needs individual.


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