Who Requires A Special Needs Trust?If you are trying to plan your estate, you may find that you are overwhelmed with the number of options that are available to you. How do you possibly weed through the piles of options and find the best solutions that will fit your needs? Aside from paying an attorney for a consultation, you have the option to dig around and look for information online, and in legal resources. If you are looking to protect a beneficiary that is mentally disabled with a special needs trust, then the research can become a much longer process than you are prepared to complete. If the intended beneficiary of a trust has benefits from the government, for either money, or medical care they are still entitled to receive those benefits regardless of the amount of the special needs trust. As a trust is established, the trustee can either be a family member who monitors the trust and ensures that it is properly managed for the disabled party, or the courts can appoint a trustee to manage the trust. The beneficiary is never allowed to be the trustee of their own trust. This is due to the fact that many special needs trusts are designed for those who are mentally disabled and if a person is disabled there are restrictions on their abilities in legal proceedings. One of the most common reasons a special needs trust is established is with the proceeds of a lawsuit due to litigation or even insurance settlements. The money that is awarded, can be placed into a special needs trust in order to ensure that the disabled person is well cared for. There are several benefits to using a special needs trust in regards to maintaining government sponsored health coverage which really helps many times for people who have a very expensive disorder. A special needs trust can be paid even before the grantor has passed away which means that the funds can be distributed to the beneficiary regardless of the time since the inception of the trust. This is not always the case in a typical living trust. Typically, a living trust does not pass to the beneficiary until the grantor dies. This is a major difference between a typical living trust and a special needs trust. With the focus on taking care of the beneficiary, there are several tax advantages that are designed to help relieve the pressure and stress that can typically be experienced when a trust payout occurs. It is also possible to set up a special needs trust in the absence of a large amount of money, especially if the intended beneficiary is unable to manage their own financial affairs at all. Setting up a special needs trust will allow all money the recipient receives to be transferred to the trust, while a trustee is responsible for ensuring that all bills are paid and that all financial needs of the recipient are handled. Not everyone feels that a special needs trust is right for them. However, they are becoming very popular because of the flexibility they offer to those who are disabled and need assistance in managing their financial affairs. With several benefits, it seems as if the popularity of special needs trust is growing steadily. If you are trying to decide if a special needs trust is right for your circumstances, you should consult with a licensed attorney to determine if it is the proper solution for your needs or if there is a solution that is better suited for your needs. It is important to note, what is best for one individual may not be best for everyone. You should select the best estate planning tool for your individual needs. |