When you are engaged in the process of estate planning, you should explore all of your options carefully and act in a fully informed manner. There are various different ways to facilitate future asset transfers, and the optimal course of action will vary depending on the circumstances.
Special Needs Planning
If you want to provide for someone with special needs, you should be aware of government benefit eligibility rules and regulations. Many people with disabilities are enrolled in the Medicaid program. Medicaid is a jointly run federal/state government health insurance program.
We practice in the state of California. In our state, Medicaid is called Medi-Cal. To qualify for Medi-Cal, you must be able to demonstrate significant financial need. Clearly, health insurance is going to be important for many people with special needs, because expensive care and treatment is often required. Many people with special needs cannot earn much income, so they qualify for Medi-Cal.
Supplemental Security Income is a government program that provides an ongoing source of income for people with disabilities who have financial need.
Let’s say that you create an estate plang and decide to provide for all of your loved ones through the terms of your living trust. You simply share your wishes with regard to the slicing of a pie into various different pieces. Each person on your inheritance list will receive a direct inheritance.
You pass away, and you leave an inheritance to the family member with special needs. She could become ineligible for much-needed government benefits because of her improved financial status.
Special needs trusts are often used in the field of estate planning to provide for people with disabilities without jeopardizing government benefit eligibility. These trusts are alternately called supplemental needs trusts.
When you create the trust, you name a trustee. This can be an individual that you know, but it could also be a professional entity like the trust section of a bank or a trust company.
The government benefits do not pay for everything that the recipient could possibly need. The trustee may utilize assets that have been conveyed into the trust to provide for these supplemental needs. As long as the beneficiary does not directly handle the funds, these expenditures would not impact government benefit eligibility.
Free Report on Special Needs Planning
If you would like to learn more about special needs planning, we have a valuable resource that is available to you at the present time free of charge. Our firm has prepared a special report on the subject, and you can download your copy through this website.
To obtain access to the report, click this link and follow the simple instructions: Sacramento Special Needs Planning.