Providing for loved ones with special needs comes with unique challenges. The desire to provide for them financially must be balanced with their eligibility for vital government benefits. A skilled trusts attorney could help you meet both of those goals.
Special needs trusts in Coral Gables can help you meet these important goals. Their purpose is to cover some of the expenses that are not paid by government benefits, without also leaving the person ineligible for that support. Veliz & Associates, P.A. is your partner in setting up and implementing all trusts in your estate plan.
The goal of every special needs trust is to help the beneficiary without negatively impacting their eligibility for government benefits. After funding the trust, a trustee is empowered to distribute money to the beneficiary. It is important to understand that these resources are meant to supplement government benefits, not replace them.
For most people who are near the poverty threshold line, eligibility for Medicaid and other benefits is crucial. That means any action by the trustee that hurts the eligibility for these benefits can be devastating. The best way to avoid this is by not using money on basic expenses like shelter or food, since that is covered by Medicaid. Funds from the trust can pay for additional things, like hobbies or transportation.
Given the challenges of administering special needs trusts, it is helpful to rely on the guidance of a Coral Gables attorney.
A Coral Gables attorney could assist with drafting a special needs trust, which fall into two general categories: third-party and first-party. An attorney could assist with drafting either type.
A third-party special needs trust is usually created by the family members of a disabled person. They earn their name from the fact that the funds come from someone other than the beneficiary.
These tools are available for anyone, regardless of their age. What’s more, there is substantial flexibility when it comes to altering or terminating this type of trust. The originating documents also determine what happens with any remaining funds following the beneficiary’s death.
Another option is first-party, or self-settled, special needs trusts. Instead of having someone else provide the financial means, the beneficiary is responsible for all funding efforts. There are age limits that must be considered, and it is only available to disabled people below the age of 65.
A unique aspect of first-party special needs trusts is that they are irrevocable. In other words, they cannot be altered or terminated after they are established. The lack of flexibility is one of the major tradeoffs with this approach.
There is also a type of first-party option known as a pooled trust. The concept is similar to insurance in that multiple beneficiaries band together and combine their resources. These funds are managed by a nonprofit organization. The purpose of pooling is to gain the benefits that come with economies of scale. Each person keeps their own separate account within the pool, but they benefit from lower costs. Another important benefit of this approach is that there are no age requirements to worry about.
If you are considering a special needs trust in Coral Gables, it can be helpful to seek support from legal counsel that is highly experienced in estate planning. The right attorney could ensure that the disabled person in your life gets the supplemental support they need without losing their government benefits. Call us today to learn more.
We evaluate your case and determine how we might be able to help.
We will meet with you to discuss your next options and lay out a plan.
Our team guides you throughout the process so you feel confident about your choices.
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