Who will care for my relative when I’m gone? This is a common question for those caring for a loved one with a disability. Providing continued care for physical or psychological disabilities raises complex questions, and many people opt for a special needs trust when planning for the future. A special needs trust is a way to provide support for a dependent disabled person and keep them financially secure when you are no longer able to care for them. They are commonly established for disabled children or ailing spouses. Once established, a special needs trust is irrevocable for as long as funds remain, until the recipient no longer needs it.
A special needs trust allows the beneficiary, the person with a disability, to use money and other property held in the trust, while at the same time allowing them to receive government benefits. Typically, people with disabilities only qualify to receive government benefits if they have an extremely low income. A special needs trust is a way of leaving money to the recipient so they can continue to qualify for benefits, while improving their quality of life.
A special needs trust can also protect against financial abuse. The trust is managed by a trustee, who can be a close friend, a relative, or a professional. The trustee is charged with managing the money so the beneficiary does not need to make financial decisions to support their care. The trustee also ensures the funds are spent for the beneficiary. This can include necessities like rent, food, caregiving and medical expenses, but can also include extras like vacations, electronics and clothes.
A special needs trust provides the opportunity to leave very individualized instructions about the beneficiary and his or her needs, as well as directions about how trust funds can and cannot be used. While there are preprinted forms that anyone can use to prepare a special needs trust, working with an attorney to create a special needs trust ensures the trust will be tailored to your family’s situation, without jeopardizing the integrity of the trust.