Special Needs Trust & Wills

Securing The Future, Empowering The Present - Get Your Special Needs Trust Today

Guarantee Your Child's Future - Maximize Their Benefits

If you leave your adult child with a significant intellectual or developmental disability over $2000 in your will, they will lose their SSI benefits. They also risk losing food stamps and housing assistance. A special needs trust in your will ensures their financial protection!

For $259.99, you will receive a personalized special needs trust, and will that can easily be notarized. Answer a few questions about your wishes and your Special Needs Trust and/or Wills will be emailed to you within minutes.

This Trust was developed from my 20+ years of legal experience. Attorneys typically charge in excess of $3,000 for these same documents!

Benefits:

Protect Government Benefits
Decide who will handle your affairs
Determine how your assets will be distributed
Decide what should happen in a medical emergency
Designate health care agents
Grant trusted individuals access to your medical records

Inlcuded Documents:

What is a Special Needs Trust?

A special needs trust is a type of trust designed to manage assets on behalf of individuals with special needs. The main purpose of a special needs trust (SNT) is to provide financial support for the individual’s needs without risking their eligibility for government benefits, such as Supplemental Security Income (SSI) or Medicaid eligibility.

The trust is typically established by a parent, grandparent, or legal guardian for the individual with special needs. Then assets are placed into the trust to be managed by a dedicated trustee. The trustee is responsible for using the assets to provide for the individual’s supplemental needs, which are expenses beyond what government benefits cover, such as education, rehabilitation, travel, entertainment, or special medical care.

By setting up a special needs trust, the individual with special needs can continue to receive government benefits while also benefiting from the assets in the trust. This is because the trust assets are not counted as income or resources for government benefit purposes. Additionally, the trust can provide peace of mind to the family or caregiver, knowing that the individual’s financial needs will be met in the future.

What is referred to commonly as a Special Needs Trust and on this website is a Third Party Trust (unless it is called a First Party Trust). A third-party special needs trust is a type of trust that is funded with assets that do not belong to the person with special needs. Instead, these trusts are typically created by a family member, friend, or other third-party individual who wants to provide financial support to the person with special needs without jeopardizing their eligibility for government benefits.
Planning for the future of someone with special needs is crucial to ensure that they receive the care and support they need throughout their lifetime. It can be difficult to think about the long-term future when you are focused on the day-to-day challenges of caring for someone with special needs, but planning ahead can provide peace of mind for both the individual with special needs and their loved ones.

The Benefits of A Special Needs Trust

Shelter Assets From Government Benefits

Individuals with special needs may rely on government benefits, such as Medicaid and Supplemental Security Income (SSI), to help pay for their care. These benefits are means-tested, which means that individuals who have too many assets or too much income may not be eligible. By placing assets in a special needs trust, individuals can ensure that they remain eligible for these benefits while also having access to additional funds to pay for their needs.

Protect Assets From Creditors and Lawsuits

Assets held in a special needs trust are protected from creditors, lawsuits, and other potential threats. This can provide peace of mind to families, knowing that the assets are secure and will be used to benefit their loved one with special needs.

Provide Financial Security to the Beneficiary

A special needs trust can provide supplemental support to individuals with special needs, beyond what government benefits cover. This can include things like education, rehabilitation, travel, entertainment, or special medical care.

Ensure assets are used as intended

A special needs trust allows families to maintain control over how the assets are distributed and used on behalf of their loved one with special needs. This can help ensure that the funds are used in a way that aligns with the family’s values and goals.

Allow others to gift to the trust

A Special Needs Trust (SNT) can allow others to gift to the trust in several ways. Typically, an SNT is created by a family member or guardian of the trust beneficiary with special needs, but anyone can contribute to the trust as long as it is established properly.

Here are some common ways that others can gift to an SNT:

Direct contributions: Anyone can make a direct cash contribution to an SNT. This can be done as a one-time gift or on a recurring basis.
Life insurance policies: A person can name an SNT as the beneficiary of their life insurance policy. Upon the person’s death, the proceeds of the policy will be paid to the SNT.
Retirement accounts: Similar to life insurance policies, a person can name an SNT as the beneficiary of their retirement account. The SNT can receive the proceeds of the account upon the person’s death.
Bequests: In a will, a person can leave a bequest to an SNT. This can be a specific dollar amount, a percentage of the estate, or a specific asset.

Avoid Probate

Assets held in a special needs trust do not go through probate, which can be a lengthy and expensive process. This can help ensure that the assets are distributed to the trust beneficiary quickly and efficiently.

Support a charity organization

When your loved one supported by the Special Needs Trust passes away any leftover assets can be designated to family members or to a charity.

What can a special needs trust be used for?

Medicines and medical devices such as prescription and nonprescription medications, supplemental dietary needs, eyeglasses, hearing aids, prosthetic devices, wheelchairs, modified scooters, and for the maintenance of these devices. Medical Services – these include a private room, private nurses, home health care, therapies, rehabilitation, hospice care, and psychological counseling. Respite care and room and board during a medical confinement. Dental check-ups and all other oral health needs. Educational training and associated expenses such as tuition, books, supplies, computers, and software. Anything that cannot be provided by the use of government benefits.

When Do You Use A Special Needs Trust

As Soon as You Know That Your Child Has Special Needs

At the time of diagnosis: If your child has been diagnosed with a disability or special needs, it is important to begin planning for their future care and support as soon as possible. This can include setting up a Special Needs Trust to ensure that they have access to the resources they need throughout their lifetime.

When setting up your estate plan with a disabled child

When you are writing your wills you must set up a SNT to insure your child’s assets are protected after you are gone.

When there is a potential that your child with a disability may receive an inheritance or settlement proceeds:

If an individual with special needs receives an inheritance or settlement proceeds, these assets can be placed in a Special Needs Trust to ensure that they do not lose eligibility for government benefits. (This situation would need a First Party Trust) When someone wants to give your child a gifts or a potential inheritance: If others wish to make gifts or donations to an individual with special needs, these assets can be directed to a Special Needs Trust to ensure that they are used to benefit the individual without affecting their eligibility for government benefits. If you have an insurance policies: An SNT can be named as a beneficiary of a life insurance policy, which can provide ongoing financial support for the beneficiary with special needs. If your child with a disability will take under an insurance policy a Special Needs Trust must be named as the beneficiary and not your child with a disability.

Who is Eligible For A Special Needs Trust?

Someone who has permanent special needs

The beneficiary of the SNT must have a disability or special needs that limit their ability to work and/or require ongoing care and support.

Someone is on medicaid because of a disability

If the person with a disability is on Medicaid, most states have asset limitation, and the Special Needs Trust will allow the person with a disability to continue to get Medicaid Healthcare coverage and have assets.

Someone who cannot manage their own finances because of a disability

The Trust would allow someone to handle there money for them.

Age:

There are no age restrictions for eligibility for an SNT.

Legal status.

The SNT beneficiary must be a U.S. citizen or legal resident to be eligible for government benefits.

Someone is on SSI because of a disability

A Special Needs Trust will allow them to continue to collect SSI and have more than $2,000 in assets.

Other acceptable uses for a special needs trust

Certain housing items and related costs: The trust can provide funds for payment of goods and services that add pleasure and quality to life including audio and video equipment, videos, CDs, DVDs, furniture, gardening expenses, home improvements such as ramps and rails to accommodate the beneficiary’s physical condition, and similar items. Recreation: The trust can provide funds for hobbies, attendance at cultural and athletic events, and vacation travel (including the cost of a companion if needed) for visits with relatives and friends. Insurance: The trust can pay the premiums for term life insurance and supplemental health insurance. Transportation: Special Needs Trusts may be used for transportation, or to purchase a car (including insurance, gasoline, and maintenance) if it is necessary for the beneficiary to perform essential daily activities, or for a specially equipped vehicle such as a modified van. Parental caretakers (qualified through the state)

Why is a will important when setting up a SNT

Provisions in the will direct assets to the trust at death

It is extremely important that your will leaves assets not to the person with a disability, but to the their Special Needs Trust. That is why when you use SpecialNeedsTrustsOnline.com the will is written at the same time as the Special Needs Trust to ensure it is done correctly.

Who are the parties involved in a SNT?

Grantor/Settlor

The grantor, also known as the settlor, is the person who creates the trust and funds it with assets.

Beneficiary

The beneficiary is the person with special needs who will receive the benefits of the trust.

Trustee

The trustee is responsible for managing the assets in the trust and distributing them to the beneficiary in accordance with the terms of the trust. The trustee can be an individual or a professional entity, such as a bank or trust company.

Successor Trustee

The successor trustee is the person or entity designated to take over as trustee if the current trustee is unable or unwilling to continue serving in that role.

How a SNT works

Grantor sets up the trust Grantor funds the trust or has provision in their will to fund it at death Trust receives money Trust proved financial support to the beneficiary When The beneficiary dies the remaining fund are distributed according to the terms of the Special Needs Trust.

Trustee of a Special Needs Trust

What does the Trustee do?

The trustee of a Special Needs Trust (SNT) is responsible for managing the assets in the trust and ensuring that they are distributed to the beneficiary in accordance with the terms of the trust. Here are some of the key duties and responsibilities of the trustee:

Investment management: The trustee is responsible for managing the assets in the trust, which may include investments such as stocks, bonds, and real estate.
Record keeping: The trustee must keep detailed records of all transactions and distributions made from the trust.
Distribution management: The trustee is responsible for making distributions to the beneficiary in accordance with the terms of the trust. The trustee must ensure that any distributions made do not affect the beneficiary’s eligibility for government benefits.
Compliance with laws and regulations: The trustee must ensure that the trust is managed in compliance with all applicable laws and regulations, including tax laws and regulations related to government benefits.
Communication: The trustee must communicate regularly with the beneficiary and any other parties involved in the trust to ensure that their needs are being met and that the trust is being managed effectively.

It is important to choose a trustee who has the necessary skills and experience to manage the trust effectively. This may include a family member, a professional trustee, or a combination of the two. Working with an experienced attorney can help ensure that the trustee is designated properly and that the trust document is structured in a way that meets the unique needs and goals of the grantor, the beneficiary, and their families.

What standard of care must the trustee uphold?

The trustee of a Special Needs Trust (SNT) must uphold a high standard of care when managing the trust assets and making distributions to the beneficiary. The specific standard of care will depend on the terms of the trust and the laws of the state in which the trust is established, but generally, the trustee must act in the best interests of the beneficiary and manage the trust with reasonable skill, care, and prudence.

Some of the key elements of the trustee’s standard of care include:

Fiduciary duty: The trustee has a fiduciary duty to act in the best interests of the beneficiary, which means that the trustee must always act in good faith, with honesty and integrity, and in a manner consistent with the terms of the trust.
Duty of loyalty: The trustee must be loyal to the beneficiary and must not engage in any actions that would benefit the trustee or any other party at the expense of the beneficiary.
Duty of prudence: The trustee must manage the trust assets with reasonable skill, care, and prudence. This means that the trustee must make informed investment decisions and must take into account the beneficiary’s current and future needs when making distributions.
Duty of impartiality: If there are multiple beneficiaries of the trust, the trustee must act with impartiality and must ensure that all beneficiaries are treated fairly.
Compliance with laws and regulations: The trustee must ensure that the trust is managed in compliance with all applicable laws and regulations, including tax laws and regulations related to government benefits.

Who can be the trustee of the special needs trust?

The trustee of a Special Needs Trust (SNT) can be any adult individual or entity that is legally able to act as a fiduciary and manage the assets in the trust. Some common options for trustees include:

Family member: A family member can serve as trustee, which may be particularly appropriate if the beneficiary is a minor or if the trust is relatively small.
Professional trustee: A professional trustee, such as a bank or trust company, can provide expertise and experience in managing the trust assets and making distributions to the beneficiary.
Combination of family member and professional trustee: It is also possible to designate a family member as co-trustee with a professional trustee, which can provide the benefits of both a personal relationship with the beneficiary and professional expertise in managing the trust.
Ultimately, the choice of trustee will depend on the specific needs and goals of the grantor, the beneficiary, and their families. It is important to choose a trustee who has the necessary skills and experience to manage the trust effectively and to ensure that the trustee is designated properly in the trust document.

How to select a trustee for your special needs trust

Choosing a trustee for your Special Needs Trust (SNT) is an important decision that can have a significant impact on the beneficiary’s quality of life. My experience is that it is best to chose a member of the family who understands the needs of the person with a disability and agrees with your vision of how that person should be able to live their life.

Here are some tips for selecting a trustee:

Consider the trustee’s qualifications: The trustee should have the necessary skills and experience to manage the trust assets and make distributions to the beneficiary in a way that meets the beneficiary’s needs and goals. This may include financial expertise, knowledge of government benefit programs, and experience working with individuals with special needs.
Evaluate the trustee’s character and values: The trustee should be someone who is trustworthy, honest, and has a strong commitment to the beneficiary’s well-being. It is important to choose a trustee who shares your values and is committed to fulfilling your wishes for the beneficiary.
Assess the trustee’s availability: The trustee should be available to manage the trust assets and make distributions to the beneficiary on an ongoing basis. If the trustee is not able to devote sufficient time and attention to the trust, it may be necessary to choose a different trustee.
Consider the trustee’s relationship with the beneficiary: Depending on the circumstances, it may be appropriate to choose a trustee who has a personal relationship with the beneficiary, such as a family member or close friend. Alternatively, a professional trustee, such as a bank or trust company, may be more appropriate if the trust is large or complex.
Review the trustee’s fees and expenses: The trustee is entitled to reasonable compensation for their services, but it is important to ensure that the fees and expenses are reasonable and consistent with industry standards.

Managing a Special Needs Trust

Investment management regarding the trust

Once the trust is funded the Trustee is responsible for managing the money in the trust. This is typically done by hiring a financial advisor or by investing the money in a brokerage account or bank account.

Steps to take after ordering your SNT through SNTO

How to select a trustee for your special needs trust

Sign the Will and the Trust in the presence of a Notary Public, be sure to follow the step by step directions for signing a Will.

Give the Personal Representative/Executor and Trustee a copy of the signed Will and Special Needs Trust

An electronic copy is great, just make sure it is signed.

Let the Personal Representative/Executor and Trustee know where you are storing the originals.

Store your trust in a safe place. Store them in a fireproof box in your house. If you store them in your safety deposit box, you need to be sure that the personal representative has a key to get access easily I’ve had cases where we’ve had to go to court to get a judge to order the safety deposit box opened.

Change beneficiary designations on financial accounts to the trust.

Be sure that all beneficiaries on all life insurance policies, stock accounts, 401(k)s, and retirement accounts, all name the trust as the beneficiary for your child with a disability. If you do not do this, you are not getting the benefit of the special needs trust.

Let potential donors (relatives, friends family) if they plan to leave money to the disabled child to give it to the trust

Decided whether to fund the trust now

Best practice is usually to fund on death of both parents.

Open A Bank Account in Brokerage Account

To open a bank account or a brokerage account the Special Needs Trust will need its own Tax ID. Not your social security number. You can get the Tax ID in minutes using

Difference between a First Person Trust & a Third Person Trust (SNT)

Both types of trusts are designed to provide for the needs of a person with a disability while preserving their eligibility for government benefits. However, the key difference between the two is that a First Person SNT is funded with the beneficiary’s own assets, while a Third Person SNT is funded with assets belonging to someone else.

First-Person Trust

A First Person Special Needs Trust (SNT) is a type of trust that is created for the benefit of an individual with a disability. In this type of trust, the person with a disability is the beneficiary and the trust is funded with assets that belong to the beneficiary, such as an inheritance, personal injury settlement, or other assets. The trustee of the trust manages the assets in the trust and uses them to provide for the beneficiary’s needs that are not covered by government benefits, such as Medicaid or Social Security Disability Insurance. The beneficiary has no control over the assets in the trust, and they cannot be used to disqualify the beneficiary from receiving government benefits.

Third-Person Trust

A Third Person Special Needs Trust is a type of trust that is created for the benefit of someone else with a disability. In this type of trust, the beneficiary is someone other than the person creating the trust, such as a family member or friend. The trust is funded with assets that do not belong to the beneficiary, such as gifts from family members or proceeds from a life insurance policy. The trustee of the trust manages the assets in the trust and uses them to provide for the beneficiary’s needs that are not covered by government benefits. This type of trust is often used by family members to provide for a loved one with a disability without disqualifying them from government benefits.

Other Documents To Protect Your Loved Ones

Meet Tom Sannicandro

I am a special needs planning attorney and an expert in Special Needs Trusts and have been practicing disability law for more than 20 years. I am the father of an adult son with Down syndrome, so I know the challenges that families face when trying to provide a future for all their children. So if you are looking for an attorney for special needs planning, look no further. After years of the practice of law, I thought the best way to give back would be to provide special needs estate planning resources and documents for families with a child with special needs in an easy and affordable way. That is why I created this 501(c)(3) nonprofit corporation to provide families with an affordable way to protect their loved ones. Visit our planning resource center now by clicking here or set up a free appointment with me by clicking here!

Frequently Asked Questions SNT Questions

What happens to a special needs trust at death?

If the SNT is a First-Party SNT, which is funded with assets that belonged to the beneficiary, any remaining funds in the trust after the beneficiary’s death must be used to reimburse the government for any Medicaid benefits paid on behalf of the beneficiary during their lifetime. After any such reimbursements are made, any remaining funds can then be distributed to the beneficiaries named in the trust, or to the beneficiary’s estate.

If the SNT is a Third-Party SNT, which is funded with assets that belonged to someone other than the beneficiary, any remaining funds in the trust after the beneficiary’s death can be distributed to the beneficiaries named in the trust, or to the beneficiary’s estate, according to the terms of the trust. The Special Needs Trust provided by SpecialNeedsTrustsOnline.com leaves the remaining assets to the beneficiary’s estate.

Do all SNT’s have the medicaid payback provision?

Only First Party Special Needs Trusts.

Are all SNT’s irrevocable?

Special Needs Trusts can be either revocable or irrevocable. The primary difference between an irrevocable trust and a revocable trust is in the degree of control that the person who creates the trust, known as the settlor, has over the trust and its assets.

In an irrevocable trust, once the trust has been created and funded, the settlor gives up all control over the assets placed in the trust, and typically cannot make changes to the trust or revoke it without the consent of the beneficiaries and/or a court. Once the trust is established, the assets placed in the trust are considered to be owned by the trust, rather than by the settlor. This can provide certain tax benefits and asset protection advantages, but the settlor generally cannot benefit from or use the assets in the trust without risking negative consequences.

The Special Needs Trust on SpecialNeedsTrustsOnline.com is revocable.

What are the pros and cons of having special needs trust?

There are several advantages and disadvantages to establishing a Special Needs Trust (SNT).
Pros:

Protects eligibility for government benefits: A SNT can help preserve the beneficiary’s eligibility for government benefits such as Medicaid, SSI, and other means-tested benefits. By placing assets into a SNT, those assets are not counted as resources for the purposes of determining eligibility for these programs.
Provides for the beneficiary’s needs: A SNT can be used to provide for the beneficiary’s needs beyond what is covered by government benefits, such as additional medical expenses, transportation, education, and other expenses.
Tax advantages: A properly structured SNT can provide tax advantages, such as the ability to minimize or eliminate taxes on trust income.
Peace of mind: Establishing a SNT can provide peace of mind for both the beneficiary and their loved ones, knowing that the beneficiary’s needs will be met and their eligibility for government benefits will not be jeopardized.

Cons:

Cost: Setting up and administering a SNT can be expensive, and the costs can vary depending on the complexity of the trust and the services of the attorney and trustee. This is not true with SpecialNeedsTrustsOnline.com as we are 501(c)(3) Nonprofit Corporation offering these documents at a fraction of the price.
Loss of control: Once assets are placed in a SNT, the beneficiary and their loved ones generally give up control over those assets. The trustee has the sole discretion to manage and distribute the assets in accordance with the terms of the trust.
Complexity: SNTs can be complex legal instruments, and may require ongoing legal and administrative support to ensure compliance with applicable laws and regulations.
Restrictions on use of funds: The funds in a SNT can only be used for the benefit of the beneficiary, and cannot be distributed for other purposes without jeopardizing the beneficiary’s eligibility for government benefits.

Will income from a special needs trust affect SSDI benefits?

If the SNT is a third-party SNT, which is funded with assets that do not belong to the beneficiary, such as gifts or inheritances from family members or friends, then the income generated by the trust generally will not affect the beneficiary’s Social Security Disability Insurance (SSDI) benefits, as the income is not considered to be the beneficiary’s income.

However, if the SNT is a first-party SNT, also known as a self-settled or payback trust, which is funded with assets belonging to the beneficiary, such as a personal injury settlement or inheritance received directly by the beneficiary, then the income generated by the trust may affect the beneficiary’s SSDI benefits, depending on the terms of the trust and the type of income generated.

For example, if the trust generates interest income, that income may be counted as “unearned income” for the purposes of determining the beneficiary’s eligibility for SSDI benefits, and may reduce the amount of the benefit or cause the beneficiary to lose eligibility altogether if the income exceeds the program’s income limits.

SpecialNeedsTrustsOnline.com is a product of Disability Resources for Families, Inc.
A 501(c)(3) Non-Profit Corporation
Annual Financial Report

Phone (508) 690-0012

63 Dolan Ave., Vineyard Haven, MA 02568
5342 Clark Road, #1012, Sarasota FL 34233

Copyright 2024 Disability Resources for Families, Inc.