For many families that have a loved one with disabilities, access to federal and/or state benefits is critical and essential. Even if the family has the financial means to pay for care, access to Medicaid may still be necessary.
Unfortunately, this situation poses a dilemma, as there are often income and asset requirements that must be met in order to receive benefits. This problem is so serious that parents have gone through great lengths to completely disinherit their children with disabilities because even leaving a small amount of money to them can cause ineligibility.
Fortunately, there are legal tools that a qualified special needs planning lawyer can help families implement to preserve benefit eligibility without forcing the loved one with disabilities into poverty. One such tool is a Special Needs Trust. These trusts are designed to allow individuals to qualify for Medicaid, even if they are over the allowable asset limit.
Special Needs Trusts are used to provide for the supplemental needs of the beneficiary of the trust, meaning that the funds in the trust can be spent on things like clothing, housewares and furnishings, education, and most other things that are not directly related to the individual’s housing and food. The money put into a Special Needs Trust will not disqualify the beneficiary or cause the beneficiary to be penalized by Medicaid as long as the trust is designed properly.
The use of a Special Needs Trust can be a huge help for individuals with special needs, but it is important that strict guidelines are followed when establishing the trust. If you have questions about Special Needs Trusts, or you would like to set up a trust for a loved one with special needs, please contact the Law Firm of Sheri R. Abrams at 571-328-5795.