What is a Special Needs Trust, and Why is it Important to Draft These Trusts Carefully to Avoid Losing Government Benefits?

What is a Special Needs Trust, and Why is it Important to Draft These Trusts Carefully to Avoid Losing Government Benefits?

A special needs trust is a specific type of trust that is designed to protect the assets of an individual with disabilities, while also ensuring that they continue to receive Medicaid or other state and federal benefits. This type of trust is essential for individuals who receive government assistance and have assets that they wish to pass on to their loved ones after their passing.

Without a special needs trust, beneficiaries may lose their Medicaid or other vital state and federal benefits if they inherit assets or receive a monetary gift. This is because these benefits are means-tested, which means that they are only available to individuals who meet certain income and asset requirements.

A special needs trust works by allowing the individual with disabilities to benefit from the trust assets without actually owning them. Instead, the trust owns the assets, and a trustee is appointed to manage them on behalf of the beneficiary. The trustee can use the trust assets to pay for expenses that are not covered by Medicaid or other state and federal benefits, such as dental care, transportation, and entertainment. Because the special needs beneficiary does not own the trust assets, the trust assets are not included in determining government benefit eligibility.

Do I Need A Montana Special Needs Trust Attorney To Create a Special Needs Trust?

While it is possible to create a special needs trust without the assistance of an attorney, it is highly recommended to work with a Montana special needs trust lawyer.

Creating a special needs trust involves navigating complex legal requirements and rules related to government benefits, which can be challenging for someone without legal expertise in this area. The downfall is that if a special needs trust is not created exactly as needed under the law, the assets held in the special needs trust will be included as being owned by the special needs beneficiary, which could result in the loss of government benefits.  As experienced Montana trust attorneys, we guide individuals through the process of setting up a special needs trust and ensure that the trust is designed to meet the specific needs of the beneficiary while not impairing government benefit eligibility.

Additionally, our trust lawyers can provide valuable guidance on funding the trust, choosing a qualified trustee to manage the trust assets, and ensuring that the trust is structured in a way that will not interfere with the beneficiary’s eligibility for government benefits.

As attorneys who specializes in special needs trusts, we can also provide ongoing support to ensure that the trust is updated as necessary to reflect any changes in the beneficiary’s circumstances or changes in government benefit programs.

What Types of Issues Should A Special Needs Trust Address?

When drafting a special needs trust, it is essential to consider the specific needs of the beneficiary. The trustee should have a clear understanding of the beneficiary’s disability and what expenses are not covered by government benefits. The trust should also be designed to provide for the beneficiary’s long-term needs, including medical care, housing, and education.

In addition, the special needs trust should be designed to take into account any changes in the beneficiary’s circumstances, such as changes in their health, living situation, or eligibility for government benefits. The trust should also be designed to provide for the beneficiary’s care after the death of the primary caregiver or trustee.

Protect The Future of A Special Needs Loved One With A Special Needs Trust!

If you have a loved one with a disability who receives government benefits, it is important to consider setting up a special needs trust. By doing so, you can ensure that your loved one’s needs are met while also providing for their future.

If you have a loved one with a disability who receives government benefits, it is important to consult with an experienced attorney who specializes in special needs trusts. BKBH is an experienced Montana special needs trust law firm that can help guide you through the process of setting up a special needs trust.