Special Needs Trusts
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Estate Planning For Persons With Special Needs

Special needs trusts – whether third-party or self-settled – are valuable tools available for beneficiaries who are disabled or have other special needs. If you have a family member, loved one or friend, who may benefit from a special needs trust, an experienced estate planning attorney at The Coleman Law Firm, PLLC can educate you on your options and guide you through the process. 

These trusts are ideal for protecting children, heirs, or other family members who have special needs, specifically those who currently receive or may potentially receive government benefits. Special needs trusts – sometimes known as supplemental needs trusts – can create a structure that allows you to pass on assets to someone with special needs without hindering their ability to qualify for government benefits such as Medicaid coverage or Supplemental Security Income (SSI). Distributions from the supplemental needs trust are designed to supplement the beneficiary’s public benefits, not supplant them.

Third Party Special Needs Trusts

The most common type of special needs trust, third party trusts are set up by someone other than the beneficiary. This is typically a parent, grandparent or sibling looking out for the welfare of a loved one. For example, a grandparent might establish a revocable trust that specifies that a special needs trust will be established for their grandchild upon the grandparents’ death. This is a tremendous tool for the loved ones of people with special needs and it literally keeps families together. Prior to the introduction of special needs trusts in the 1970s it was no uncommon for disabled individuals to be disinherited in order to avoid disqualifying them for benefits once they receive an inheritance.

First Party Special Needs Trusts

“Self-settled” special needs trusts is different from the third-party special needs trust in that the self-settled supplemental needs trust is established by the beneficiary of the special needs trusts and funded with the beneficiary’s own assets. Typically the assets to fund the self-settled special needs trust arise from some unusual event, often a personal injury lawsuit, but could also be from lottery winnings, or even a significant inheritance that was received by the beneficiary without the benefit of a third party special needs trust or supplemental needs trust. Assets left in the trust after the beneficiary’s death are subject to Medicaid recovery. 

Experienced Guidance For All Your Estate Planning Needs

Planning to protect a loved one with special needs is a legally complicated process. Let our experienced estate planning attorneys be your guide. Call our Jacksonville office at (866) 510-9099 or email us today.