Planning a trust is a great way to ensure that your loved ones are cared for long into the future. At The Berman Law Group, we are experts in fiduciary law, including the creating and administering of trusts of all shapes and sizes. But what do you do if the trust you hope to set up is for an individual with special needs? Here’s what you need to know about special needs planning in Florida.
Special Needs Trusts
A special needs trust is a trust set up especially for the benefit – and needs – of an individual with a mental disability. They are especially useful for those individuals who have a diminished lack of capacity to manage their own interests or finances.
Special needs trusts differ from other varieties of trusts in two specific ways. First, any funds held in the trust are not subject to seizure by any creditors at any time. Secondly, any transfers of money into the trust are totally exempt from Medicaid’s five-year look back period. This period is required by the government for any individual who wished to receive coverage and proves a limited-income threshold is not surpassed for the past five years.
Benefits of a Special Needs Trust
One of the primary benefits of establishing a special needs trust is that they can be specifically designed to address the unique needs of a disabled person, something which a normal type of trust cannot do.
Another benefit of establishing a special needs trust is that such a trust will not directly hinder the disabled individual’s ability to collect government benefits as a result of their disability. Often, those with a mental disability qualify for government benefits and subsidies, such as Supplemental Security Income (SSI), Medicaid or other benefits. If money or assets are left to an individual in a will, they may lose the ability to collect government benefits, because acquiring lump-sum assets in such a manner may be disqualifying due to income requirements.
Special needs trusts counteract the issues of leaving assets to special needs individuals in that these trusts are not considered “countable assets.” This means that the trust will not limit an individual’s ability to claim governmental needs-based benefits.
Do You Need a Lawyer to Set Up a Special Needs Trust?
While you do not specifically need a lawyer to set up any form of trust, you should consider discussing any issues pertaining to setting up a trust with an experienced South Florida trust administration attorney. This is especially true when it comes to special needs trusts. Because of the implications on the availability of governmental benefits, as well as taxation, the wording of special needs trusts must be carefully constructed to ensure that the beneficiary of the trust gets all they are entitled to.
If you are seeking to create a trust for a special needs individual in the state of Florida, you should seek legal counsel immediately. Make sure that your loved one gets all the assets they are entitled to while limiting their tax or benefit risks. Make sure you get a trusted and experienced trust administration attorney who is willing to fight for your rights. Call The Berman Law Group right now at (800) 883-5206 for your free consultation.