A special needs trust is designed for beneficiaries who are disabled, either physical or mentally. It is often viewed at as a stand-alone document that can be included in a Last Will and Testament or a Revocable Living Trust.
Special Needs trusts can provide benefits far beyond a traditional trust, addressing the specific needs of that disabled family member. Some of these benefits include supplemental security income, Medicaid, vocational rehab, and subsidized housing to name a few.
If the beneficiary lacks the legal capacity to handle his/her finances, an administrator, whether a private trust run by family members or by trustees appointed to the court, can hold and manage property intended for the beneficiary. In additional to the unlimited amount of assets a Special Needs Trust can provide, it can also protect your beneficiary should they encounter a lawsuit. Trust funds are not subject to creditors or seizures, and are not subject to judgment.
It is important to keep in mind that when a child turns 18, they are presumed to have the legal rights of adults, no matter their condition. Therefore, parents and guardians should make a valiant effort to learn about all the different options for their beneficiary and seek legal counsel. It is important to remember that if you wish to set up a special needs trust, you need to do so with an attorney familiar with this area of law. A poorly written trust can be ineffective if not written properly.
To learn more about special needs trusts or discuss other estate planning options, contact Michael Wild of Wild Felice & Partners in Plantation for a free consultation.