Special Needs Trust - 7 Often Asked Concerns About Special Needs Trusts

It's never simple to think about what will happen when you are gone. Nevertheless, it's an eventuality you should plan for, particularly if you have a child with special needs. Who will take care of them? Will they have the necessary monetary resources? These lingering concerns can be answered years before if you have a special needs trust drawn up. Here are some of the most generally asked concerns about this type of trust:

My child has special needs. What will happen to him or her when I'm gone?

You may be anxious when thinking about the care your child will receive as soon as you've passed. You may wonder if his or her high quality of life will endure with your absence. Nevertheless, do you have the resources to make sure quality care with out SSI or Medicaid help? If not, then your child will require these benefits and funds to supplement them. Therefore the require for a special needs trust.

How does a special needs trust work?

It offers your child with benefits with out losing public welfare help, like SSI and Medicaid. This kind of trust comes in two categories: self-settled, exactly where benefits like a settlement or inheritance don't interfere with governmental aid and third party, where the disabled is given funds from family members and others.

Does my disabled family member need a trust?

It depends on the situations. Not every disabled person who has been awarded a settlement or inheritance needs a special needs trust to continue receiving government benefits. If your relative would have trouble overseeing the assets, may require benefits later or could be taken benefit of, then a trust is advisable.

Will the trust qualify them for Medicaid, SSI or other public aid?

No. The trust tends to make it easier to qualify for aid, although the person must meet qualifications to receive help.

What will trust spend for?

It will provide the resources to pay for all types of medical treatments, like physical therapy, medications and devices. Daily living specifications, like a car, housing expenses, clothes and food, are also eligible to be paid for from the trust. SSI advantages may be reduced some if the trust is used to pay for food or shelter. How are trusts taxed?

In order to establish and administer the trust, income, gift and estate taxes need to be considered and reviewed carefully by an attorney or accountant.

How does the beneficiary access the funds?

In establishing the trust, you must select someone to be the trustee. This person should not give your relative the funds directly, as this could disqualify him or her from future government benefits. Instead, the trustee should use the assets to purchase necessary items, like a personal care attendant, vacations, furnishings, medical expenses, etc.

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