The Dangers of Not Having a Special Needs Trust

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21st Sep 2015


Understanding wills and trusts and the different components of each, can prove to be quite confusing. But, one very important component that should not go overlooked is the Special Needs Trust. If you care for a special needs child or loved one, you will want to establish specific documentation regarding your preferences for their care in the event that you are no longer able to provide them that care.

Laws regarding Special Needs Trusts in the state of California have been set up by the government specifically to allow families to protect their special needs family members. If this type of trust is not set up, special needs individuals could end up not being sufficiently cared or provided for after you are gone.

Simply providing your disabled family members with money and assets, through your will, is not enough to protect them. Read the guidelines listed below to ensure that your disabled and special needs family members get the best possible care in the wake of your absence.

Your Family Members Are Not Fully Protected by Your Will

Normally when you want to make sure that a family member receives certain monies and assets, you simply draw up a will and document which items are to go to who. However, when it comes to disabled and special needs family members this can actually do more harm than good.

One of the main concerns regarding the simple act of willing items to these family members is that this type of bequest can actually end up disqualifying them from receiving support from Supplemental Security Income (SSI), Medi-Cal, In-Home Support Services (IHSS), and HUD housing assistance. This is why setting up a Special Needs Trust will ensure that they can receive both the benefits of your bequests as well as governmental benefits.

Special Needs Trusts must be put together carefully in order to supplement and not replace public benefits that your family members have the right to receive. A crucial aspect to the trust is that it allows you to appoint a third party trustee to handle the affairs of your family member. This will protect your family member’s government benefits, while also allowing the trustee to distribute to your family the items and monies that you would like them to receive.

Government Assistance will only Provide Bare Living Necessities

In the event that you choose to include your special needs family member in your will and no other planning is done on their behalf, your family member may likely end up not receiving any of their rightful government and public support. Or what could be even worse, they could end up relying solely on government assistance.

Government and public assistance is not set up to assist a person in thriving through life. The programs often offer only the bare minimums of support, to allow a person to survive. This can be especially difficult for these family members as most times they need extra assistance and accommodations in order to have a happy and fulfilling life.

A Special Needs Trust gives you the flexibility and opportunity to list and decree specifically who you would like to take charge of the care of your family member. This person will manage the assets and money that you leave to your family member, as well as, assist your loved one with other important life decisions regarding their financial status, their medical care, and their overall well-being.

The Language Used in a Special Needs Trust Must be Specific

The main purpose of the Special Needs Trust, aside from protecting your family member, is to protect their right to benefits from certain government and public entities. This is why it is extremely important that the language used in a Special Needs Trust meet certain requirements. We here at Tompkins Law strongly advise you to be sure that you meet with a trusted and knowledgeable attorney to set up the trust.

The language regarding the trustee must state that only the trustee is able to make decisions regarding when and how to use the funds to benefit your family member, the “beneficiary.” This is crucial in that, if the beneficiary is listed as the person who can make these types of decisions then your family member’s benefits could be endanger of being restricted.

Another area in which the terminology used in the Special Needs Trust must be clear is regarding the trust’s main purpose. The trust must state that the main purpose of the trust is to supplement the support and services the beneficiary receives from government and public organizations. If the terminology is not written adequately, again your family member could be in danger of losing or being disqualified from their benefits.

The third area of concern for wording in the trust is regarding the beneficiary’s rights. The trust must state that the beneficiary, your family member, is not able to sell or give away their rights to anyone else and that they have no control over the assets. This part is crucial to protecting your family member from being disqualified from receiving their rightful government and public benefits.

As mentioned early, Special Needs Trusts can be complicated and confusing. When it comes to leaving your disabled child or family member the best possible future, you will want to make sure that you set up the trust and with very specific language. Tompkins Law can assist you in ensuring that your loved one is taken care of and faces no risk of losing any possible government of public benefits they deserve.

It is important to know that a will, alone, won’t ensure that your family member receives the best care. Additionally, you will not want your family member to have to survive on government or public support and assistance alone. Setting up a Special Needs Trust will allow your family member to receive the benefits they deserve while also receiving supplemental benefits from your estate. This is the best way to care and provide for your disabled family member’s future.

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