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Special Needs Require Special Planning

May 1, 2013


Many people in the United States are currently considered disabled as defined by Social Security. Their disability may entitle them to receive various benefits that are provided by the federal and state government. Some of these benefits, such as Medicaid, Supplemental Security Income, Food Stamps, housing or fuel assistance, may only be available to the disabled person if he or she meets eligibility requirements that require the disabled person to have income or assets less than a certain amount. Should a disabled person receive an inheritance outright, the inheritance almost always causes the asset limit to be exceeded and benefits to be lost. Fortunately, with proper planning it is possible to leave an inheritance to a disabled person and not disrupt their benefits in any way.

Often, a parent or family member of a disabled person will choose to leave the disabled person’s inheritance to another family member, who is then expected to provide for the disabled individual. This plan may work if the family member carries out their obligation as anticipated, but this plan in no way guarantees that the disabled person will receive the benefit of the assets left with the other family member. As such, the best plan includes a Special Needs Trust, which is designed to benefit the disabled person and simultaneously prevent the disabled person from losing any available governmental benefits.

A Special Needs Trust should become the primary vehicle for providing for the needs of the disabled person to the extent that those needs are not otherwise provided for by public benefits or any other source. Thus, the funds held in a Special Needs Trust are typically used…

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by: Gina M. Barry

May 2013

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