Special needs trusts and estate planning

On Behalf of | Dec 31, 2018 | Trusts |

Parents of children with disabilities who are living in Georgia are often concerned about estate planning. If a person with a disability is receiving Supplemental Security Income (SSI) benefits, getting additional income, even in the form of an estate bequest, could disrupt SSI payments and eligibility for Medicaid.

Because SSI and Medicaid benefits are awarded based on both disability as well as financial need, any income from any source needs to be accounted for to determine whether the recipient is entitled to continue receiving financial assistance. A standard bequest in a will, for example, could make the beneficiary ineligible for Supplemental Security Income and Medicaid benefits. Once the money from the bequest runs out, the beneficiary would have to reapply for benefits, something that could create significant financial and personal hardship.

To avoid disrupting a person’s access to financial support and health care services, parents have the option of creating a special needs trust. A special needs trust is administered by a third party for the purpose of funding things that can enhance the quality of life of the beneficiary. These things may include travel, care of pets and other items that make life easier for the beneficiary. The trust is generally protected from creditors’ claims, providing a high-level of protection for the beneficiary.

Parents who are considering estate plans that might include a special needs trust may benefit from speaking with an attorney. The lawyer may be able to review the client’s situation and make recommendations regarding estate planning that can provide support and comfort to beneficiaries for many years.

FindLaw Network