If you have a loved one who struggles with a disability and you worry about their future, it is important to understand how estate planning could benefit them and provide your entire family with peace of mind. For example, you could have the ability to create a special needs trust in order to help them.
It is important to note that special needs trusts have a number of requirements.
Beneficiary age and other special needs trust requirements
According to the Minnesota Department of Human Services, special needs trusts can help disabled individuals under the age of 65. In order to qualify for special needs trusts, disabled beneficiaries must satisfy the SSI program’s disability criteria when trusts are set up. Moreover, special needs trusts must serve the sole benefit of the disabled beneficiary.
Sometimes, special needs trusts are set up by a grandparent, parent, the court or a legal guardian. Disabled people can also set up a special needs trust for themselves.
The benefits of special needs trusts
Special needs trusts can play a crucial role with respect to disabled people receiving assets they need and benefits that they count on. Unlike other types of trusts, which can result in disabled beneficiaries becoming disqualified for critical government benefits that they count on (such as Medicaid and SSI), special needs trusts can allow disabled people to remain eligible for these programs.
If your disabled loved one depends on Medicaid and/or SSI, you should carefully examine the advantages that come with a special needs trust and thoroughly review the process of setting up such a trust.