What is a special needs trust?
What is a special needs trust? A trust is a legal entity in which a person ("the Grantor") places money to be used for the benefit of someone else ("the Beneficiary"). The money and assets in the trust are managed by a Trustee, whose job is to follow the instructions set forth in the trust document. A special needs trust is unique, because it uses language and mechanisms specifically designed to protect assets for disabled beneficiaries. These legal entities serve to supplement, rather than supplant, public disability benefits.
Perhaps you want to leave money or other assets to an incapacitated individual as part of your estate plan. Or maybe you'd like to give a gift to a family member or loved-one who suffers from a disability. This is an example of a third-party settled special needs trust - one that is funded with the money of someone other than the beneficiary.
Self-settled special needs trust
A self-settled special needs trust is one that is funded with the money and assets of the disabled beneficiary themselves. For example, anyone receiving proceeds from a medical malpractice lawsuit, should consider putting the funds into a trust, so that they are not disqualified from public disability benefits.
Failure to protect assets with a special needs trust will result in the loss of disability benefits and could force a rapid spend-down of large sums of money that should have been protected and preserved.
As very strict rules and requirements apply, it is crucial that an experienced special needs planning attorney prepares your special needs trust. If you are in need of a special needs trust, contact your Pittsburgh Special Needs Trust attorneys at McMorrow Law, LLC at 724-940-0100 or 412-407-2816, to discuss your case.