Tuesday, June 3, 2014
As I have previously discussed, special needs trusts permits people to remain eligible for public benefits such as Medicaid and Supplemental Security Income, while taking supplemental income. However, they require careful planning and there are common pitfalls along the way.
Parents of children with special needs should create a plan for how their child will be cared for after they are gone. Many parents plan for their child’s care by putting assets directly in their child’s name or leaving assets to the child in their will, but this can disqualify them from governmental assistance, which they will likely need. This is where special needs trust come in, but the planning does not stop there. It is important to carefully calculate how much financial assistance the child will need, how the trust will be funded, and who the most trusted person is to run the trust.
See Jennifer Woods, Special Needs Trusts: Helping Parents Provide for Kids’ Futures, CNBC, May 31, 2014.