A special needs trust, sometimes referred to as a supplemental needs trust, is a specific type of trust used to provide support for a special needs individual. This exceptional estate planning tool should be considered by anyone who has a child or loved one who qualifies. So what is a supplemental needs trust and why would I want to create one?
- A Special needs trust, or SNT, may be used for an individual who is physically or mentally disabled or who suffers from a chronic or acquired illness.
- A parent, grandparent or guardian may set up an SNT.
- A SNT is intended to provide supplemental care above and beyond that which is provided by government sponsored programs such as Medi-Cal (Medicaid), SSI or public housing.
- A SNT will not disqualify the beneficiary from government assistance programs. A SNT is specifically intended to allow a beneficiary to qualify for these programs while still having access to additional means of financial support.
- Absent an SNT, any funds used to care for the individual could jeopardize his or her eligibility for government assistance programs.
- A SNT will continue to operate after your child reaches adulthood.
- A SNT will also continue to operate after your death if you wish.
- Although you may appoint yourself to be the trustee of the trust, this is not the same as being your child’s legal guardian.
- Very specific language is required to draft a proper SNT. Be sure to consult with an experienced and qualified planning attorney if you are interested in creating a SNT.
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