Protect Loved Ones With Special Needs
Planning for the future care of a child with special needs can be challenging. On the one hand, families want to be sure that their child is afforded all the benefits that they have worked so hard to secure.
New Jersey Estate Planning Lawyers Diligently Create Special Needs Trusts to Provide Ongoing Support for Those With Special Needs
At Begley Law Group, our knowledgeable and compassionate New Jersey estate planning attorneys work closely with clients and their families to create special needs trusts. We can also serve as trustees for a special needs trust, or offer reliable guidance to families with questions about these useful estate planning tools.
What is a Special Needs Trust?
Most individuals with special needs receive needs-based government benefits such as Supplemental Security Income (SSI) and Medicaid. While many parents have the means to leave significant assets to children with special needs, doing so may jeopardize their child’s benefit eligibility. Special needs trusts are one way for families to address each of these concerns.
Special Needs Trusts
Assets in a Special Needs Trust trust belong to the trust, not the beneficiary.
A special needs trust, also referred to as a supplemental needs trust, is a legal relationship in which trust assets are managed by a trustee for the benefit of a beneficiary. Beneficiaries can receive the benefit of the trust funds, through purchases of qualifying goods and services, at the discretion of the trustee and pursuant to the trust document. Because the trust assets do not legally belong to the beneficiary, funds in a special needs trust will not count toward needs-based benefit resource limits. Thus, the overarching purpose of a special needs trust is to allow an individual with special needs access to additional funds without jeopardizing their benefit eligibility.
Requirements of a New Jersey Special Needs Trust
Generally, when someone who receives government needs-based benefits or inherits cash or other assets, the inherited assets will count toward the resource limit.
In most cases, this will render a recipient ineligible to continue receiving benefits. Special needs trusts are useful tools for families to provide additional support to loved ones with special needs while ensuring that their loved one remains eligible for important government benefits such as SSI and Medicaid. However, special needs trusts are very specific and must be created with precision.
For example, special needs trusts must meet each of the following elements:
- The trust must be irrevocable;
- The beneficiary must not be able to compel a distribution from the trust; and
- The beneficiary must not be able to terminate the trust.
What Can Beneficiaries Buy With Funds in a Special Needs Trust?
One of the most common questions beneficiaries and trustees have regarding special needs trusts involves what expenses can be paid with trust funds. Generally, special needs trusts can be used to pay fora wide range of supplemental needs. These needs include:
- Caregiving expenses
- Assistive technology
- Computersand other electronics
- Traveling, potentially including the cost of a companion’s travel
- Home renovations to improve accessibility
- Medication that is not covered by Medicaid
- Computersand other electronics
- Necessary services, such as cell phones and internet
The main prohibitions when it comes to expenses relate to food and shelter. Thus, funds in a special needs trust should not be used to pay for things like groceries or rent, unless first discussing these payments with an experienced New Jersey special needs planning attorney.
Who Should Serve as a Trustee?
From the onset, a business owner should develop a team of professional advisors to assist in business plan development and maintenance. This team should consist of the following:
- An attorney.
- A CPA.
- A financial advisor.
- A family business consultant (if the business is large and the emotional issues are complex).
Contact a Dedicated New Jersey Estate Planning Attorney With Extensive Experience Creating Special Needs Trusts
By creating a New Jersey special needs trust for a loved one with a disability, you can ensure that your loved one is provided for while keeping their government benefits intact and also retain the ability to make important decisions on their behalf. The skilled New Jersey and Pennsylvania estate planning attorneys at Begley Law Group command an in-depth knowledge of all estate planning and special needs planning principles and put this knowledge behind each client we serve. We also handle veteran’s benefits, guardianship, Medicaid planning and other issues related to the practice of New Jersey elder law.
To learn more, and to set up a time for your consultation, call 856-235-8501 or toll-free at 800-533-7227. You can also reach out to us through our online form.