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Special Needs Planning – Does The Type Of Disability Matter?

The only requirement is that the person is disabled and is receiving governmental benefits as a result of their disability; be it Social Security Disability, and/or Medicaid. That disability would require them to have a supplemental or special needs trust set up for them if they were to acquire money from a personal injury award or an inheritance.

The disabled person requires special planning as opposed to an individual that is not getting any sort of government benefits and is not receiving disability payments from the government and or Medicaid.

The type of disability does not necessarily matter in the sense that as long as the person is disabled and is getting social security disability and/or Medicaid, the supplemental needs trust could be created for their benefit.

It does not matter what type of disability that they are suffering from or what type of special needs that they have. The SNT trust essentially allows for a trustee to, manage that disabled person’s money, and allows them to do so and provide for them and allow them to have the things that they would not necessarily be able to have if they did not have that money in the supplemental needs trust.

Meaning, that if they held that money in their individual name instead of having it placed into a supplemental needs trust, the disabled person would obviously get knocked off of Medicaid and or lose their Social Security income that they are receiving from the government, because of their disability. This would occur because they would be over-resourced, meaning that if they had the money in their individual name, they would have too much money and they would no longer qualify for Medicaid to cover their health benefits and or entitle them to income from the Federal Government because of their disability.

In those situations if their benefits are being obtained because of disabilities and were based on income level or asset levels, they would not necessarily be able to continue getting those benefits if they had assets in their individual name. So that is why you would want to have the supplemental or special needs trust in place.

Are The Special Needs Trust Irrevocable?

Yes, they are irrevocable, and because of the irrevocability, it allows for the governmental benefits including Medicaid and social security disability payments to continue. If it was not irrevocable the governmental benefits would not be allowed to continue.

What Are The Duties Associated With The Trustee Of A Special Needs Trust?

Obviously for any trust regardless of whether it is a special needs trust or a trust setup for a person who does not necessarily have disabilities, a trustee is a person that has a very important role. The person that is chosen has to be someone that is trusted and that will fulfill their duties to the person that is going to be benefiting from the trust. A trustee is an important position. A person should be chosen that could be trusted and would stand to do what needs to be done in order to fulfill the wishes of the person creating the trust. However, a person that is a trustee for a supplemental needs trust or a special needs trust; their role is a little different.

It is actually a little more involved because certain expenditures can or cannot be made by a trustee if they are concerned about continuing a person’s disability payments from the government. For example, those trust assets that are placed into a supplemental needs trust could pretty much be used for anything (except under some limited circumstances based on some factual and mathematical analysis and calculations ; payment for rent and or food could be limited by the SNT trust) for an individual who has disabilities and wishes to continue getting their full disability and or at least partial payments from the government, depending on the type of disability payments they are receiving.

So that is a little bit different for a trustee on a supplemental needs trust, whereas there is language in the trust if drafted properly that allows for a trustee to still make payments on those two items at their discretion if they choose to, even at the expense of making the person lose or lessen their disability payments if the trustee felt it to be in the best interest of the disabled person.

These are the two items that a trustee has to be knowledgeable about. The funds in the trust could be used by the disabled person for pretty much everything else, except for those very two limited items.

Even then the funds could still be used, but generally speaking, the funds held in the SNT trust should not be used to make rent payments or pay for food for that disabled person. The theory behind that is the person’s income, or disability income that they are receiving from the government, should be used to pay for those expenditures and not funds that are in a supplemental needs trust. Whereas everything else should be, or could be used to be paid for by the funds that are in that supplemental needs trust.

The state of New York allows health care proxy to appoint someone you trust, like a family member or close friend, to make health care decisions for you in case you lose ability. Same is the case with a special needs attorney. The special needs attorney and lawyer understand the needs of their client and they also know that the person will need elder care once they grow old. That is when you need to contact our estate planning lawyers and elder law lawyers for legal assistance.

For more information on Definition Of Special Needs, a free initial consultation is your next best step. Get the information and legal answers you are seeking by calling (718) 475-9639 today. You can also visit our offices located in Staten Island, New York, Brooklyn, Bronx, White Plains, Garden City, Melville, NY.

New York Attorney Michael Camporeale

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