Special Needs Planning

If you have a family member or loved one that is disabled or has special needs, it is very important to take this into consideration in the course of your planning. If the person is currently receiving government benefits, specific planning is required to avoid disrupting eligibility. On the other hand, if the person is not yet receiving benefits, this could change by the time you pass away. In either case, planning ahead can be the difference between improving their life with your gifts or not.

Special Needs Trusts

Special needs trusts (SNTs) can be useful for numerous circumstances:

  • For children and grandchildren. If a parent or grandparent wants to make gifts either during their lifetime or upon their death, SNTs are an effective tool for making gifts to disabled or special needs children and grandchildren of all ages, while taking into consideration means-tested benefits that they may be receiving.
  • Personal injury or medical malpractice settlements. If there is a personal injury, medical malpractice, or other settlement that is to be paid to a disabled individuals, a properly-drafted SNT can receive an hold the settlement amount without affecting means-tested benefits that they may be receiving.
  • Inheritance by the disabled individual. If a disabled individual is in line to receive an inheritance, quick action may be necessary to protect the inherited amount to avoid an interruption in means-tested benefits.

SNTs can be customized for the situation, or established within a non-profit entity formed under federal laws to hold assets for the benefit of disabled individuals. The rules relative to creation, funding, and disbursement from SNTs are strict, and if not followed, can cause very negative consequences.

Kissinger Law Office can provide guidance with SNTs or other tools uniquely suited for disability planning situations.