Learn how establishing special needs trusts can help protect your loved ones.
Creating a secure financial future for a loved one with special needs often requires more than just good intentions—it takes careful planning. One of the most powerful tools families can use is a Special Needs Trust (SNT). This estate planning instrument helps ensure that an individual with a disability is cared for without compromising their access to public benefits like Medicaid or Supplemental Security Income. If you want to take every step possible to protect your loved ones after you’re gone, establishing a Special Needs Trust with the Millman Law Group is an essential step.
Why a Special Needs Trust Matters
Public assistance programs for individuals with disabilities often have strict income and asset limits. Even modest financial gifts or inheritances can make a person ineligible for vital services. A special needs trust allows you to set aside funds specifically for your loved one without those assets counting against them when qualifying for public benefits.
The trust can be used to pay for a variety of life-enhancing expenses—like therapies, education, personal care, transportation, and more—while government programs continue covering essential medical care and basic needs.
Using a Loved One’s Assets to Fund the Trust
In some cases, the individual with special needs may already have assets in their name. For example, they might receive a legal settlement or an inheritance directly. When this happens, families can establish what’s known as a first-party special needs trust.
This type of trust is funded using the person’s own money, and it can help ensure they remain eligible for benefits. It must be designed so that the assets are used only for the sole benefit of the individual. Since a change in federal law in 2016, mentally and legally competent individuals with disabilities can create these trusts themselves if needed.
First-party SNTs come with some additional rules, especially regarding Medicaid payback provisions upon the beneficiary’s passing, so professional legal guidance is essential.
Providing Long-Term Support with Family-Funded Trusts
When the funds are coming from parents, grandparents, or others, a third-party special needs trust is the preferred option. This trust can be created during the grantor’s lifetime or as part of a will or living trust. It’s especially helpful for families who want to ensure ongoing care for their loved one after their own passing.
A third-party trust provides more flexibility—there’s no Medicaid payback requirement, and multiple people can contribute to the trust. It’s an ideal solution for families who want to plan ahead and build a financial safety net that remains in place throughout the beneficiary’s lifetime.
Balancing Care and Eligibility
One of the key benefits of using a special needs trust is that it allows families to manage both care and financial resources without jeopardizing benefit eligibility. However, these trusts must be structured correctly. For instance, if the disabled beneficiary retains too much control over the assets or can revoke the trust, those assets may be counted against them when applying for benefits.
Proper legal drafting ensures that the trust complies with all requirements and serves its intended purpose. With the right setup, the trust can act as both a financial buffer and a resource for enhanced quality of life.
Partner with a Legal Team That Understands Your Goals
Every family’s situation is unique, and creating a special needs trust that fits your circumstances takes careful planning. At The Millman Law Group, we understand how emotional and complex this process can be. That’s why we offer guidance tailored to your needs—helping you protect your loved one’s future while navigating the complicated web of public benefits and legal requirements.
If you’re ready to learn more about how a special needs trust can support your family, contact us today to schedule a free consultation.
Estate Planning Made Easy With Millman Law Group
Millman Law Group, PLLC is rare because it’s one of the only law firms that offer life planning in South Florida. From life care planning to the preparation of detailed estate plans, Millman Law Group has committed to serving Floridian elderly communities in Boca Raton, Palm Beach County, Ocean Ridge, Hillsboro Beach, and many other areas since 2018. Our dedicated team also specializes in special needs Trusts and catering to any age demographic because we know for certain it’s never too early to start preparing you and your family for your future. For the latest news in estate planning and elder care law, follow us on Facebook, Twitter, Linked In, and Pinterest. You can also contact us at 561-463-6480.