Thursday, September 10, 2009

SPECIAL NEEDS TRUSTS

SPECIAL NEEDS TRUSTS

Parents who have a disabled child or child who is severely incapacitated, are faced with the problem of how to provide for that child financially after the parents have passed away.

Because the child (whether a minor or an adult) may have qualified for various kinds of governmental benefits and assistance, the parents must be careful not to disqualify the child due to an inheritance. Many government programs require the child-recipient to have resources and income below a certain level to qualify.

A solution to this problem is to create a "Special Needs Trust" for the child. Through a special needs trust, the parents can provide a financial benefit to the child to supplement the disabled child's government benefits without interfering with the government aid.

Some key elements of a special needs trust is that the disabled child may not be the trustee or have any control or direction over the assets of the trust; and that the trust must be irrevocable.

A qualified estate planning attorney can be helpful because of the complexity of navigating in the field of the various public benefits and the rules concerning them.

Trust clauses can be designed to preserve trust benefits even if the law or the beneficiary's condition change during the term of the trust. "Backstop" provisions can be written to preserve trust assets if the eligibility rules change for the child during the trust term.

If you are interested in "Special Needs Trust" and need more information, contact a qualified estate planning attorney in your area; or contact me directly:

http://www.tompkins-law.com/

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is intended as information only and not as a substitute for legal advice by a qualified attorney in your jurisdiction.

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