If you are a caretaker of a family member or friend with a disability, injury, or other special need, you may be wondering who will take care of this person when you are no longer able too. Families face this difficulty every day, worrying not only about who will provide care, but how it will be paid for. To address these very real concerns, the Special Needs Trust (SNT) was established.
What is a Trust
To fully understand what a SNT is and how it works, you first have to understand what a basic trust is. A trust is a written legal arrangement in which one party holds property for the benefit of another. The actual trust is a separate legal entity created to hold assets and real or personal property.
A validly formed trust names a trustor, a trustess, and a beneficiary. The trustor executes the trust agreement, delivering property to the trustee to be held for the benefit of the beneficiary.
Special Needs Trust
A Special Needs Trust, also referred to as a Supplemental Needs Trust, is a legal agreement specifically designed to benefit a person under a physical or mental disability, or with a chronic or acquired illness. The disabled individual is the beneficiary of a SNT, which holds for his benefit an unlimited amount of assets.
One of the most beneficial features of a SNT is that if it is properly formed, its assets are not considered countable assets for purposes of determining qualification for certain governmental benefits like Supplemental Security Income (SSI), Medicaid, vocational rehabilitation, and subsidized housing. For purposes of a SNT and government benefits, an individual is considered impoverished if his or her personal assets are less than $2,000.00.
A SNT can be a stand-alone document or a part of a Will or Family Trust. A SNT must be irrevocable, include provisions for trust termination or dissolution under certain circumstances, and include explicit directions for amendment when necessary. It can be a wonderful tool to assure that your loved one is cared for in ways not possible under normal government assistance.
The Astill Law Office has provided high quality legal services for over 30 years. We specialize in wills, trusts, estate planning, and asset protection. If you have any questions about creating a Trust, Will, or estate planning in general, contact The Astill Law Office at 801-438-8698.