If, like Sabina and me, you have a loved one who is disabled, then you know how important government assistance programs can be to their well-being. But to qualify for these programs, your dependent must have limited finances. So, any inheritance you leave him or her could potentially put their eligibility for government assistance at risk.
So, how can you provide for a loved one without interfering with government assistance?
What you need is a Special Needs Trust.
This unique legal document allows you to provide for your dependent's supplemental needs without disqualifying him or her from programs such as Social Security and Medicaid.
Upon your death, any funds you intended for your disabled dependent will be transferred to a special trust, created for the sole purpose of providing for your dependent. Because the funds are not in your dependent's name and are managed by a third-party trustee, your dependent can continue to benefit from government assistance.
Of course, there are restrictions on what the trust can pay for but in general, you're allowed to provide for any supplemental needs, such as cable television, travel expenses, education, entertainment and the like. The trust can also provide your dependent with home health care services, a car, clothing and even pay for medical expenses. Just remember than any asset that requires a title or deed must be in the name of the trust and not your dependent.
This allows you to ensure that your disabled dependent is well provided for and enjoys a rich and happy life while still qualifying for those much-needed government programs.
Who Should Be Trustee?
Choosing a trustee for a Special Needs Trust is especially important because the person you choose will have authority and control over the funds in the trust. That means you need to be able to trust this person completely, especially if your dependent is mentally handicapped and unable to recognize any misappropriation of funds. Many people choose a parent or sibling of the disabled person to act as trustee, but you can select anyone you want, including a law firm or a financial institution.
Tips in Making a Family Tree for Your Estate Plan Retirement Planning: It's About More Than Just Finances Preparing and Writing Your Own Living Will How to Include Your Pets in Your Estate Plan Planning For Your Personal Effects How to Avoid a Guardianship
0 comments:
Post a Comment