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What is a special needs trust?

On Behalf of | Dec 5, 2019 | Trusts

Formulating a regular will in Florida can be a process on its own, but if you are looking to provide for a loved one with special needs, the situation becomes much more complicated. In the event that you are looking to support a loved one with special needs, formulating a special needs trust is all but necessary. According to Special Needs Answers, a special needs trust is a specific type of trust that can help a person with special needs managed assets while not compromising their access to government benefits. 

The reason why this is so important is that many persons with special needs are reliant on government benefits. For example, many individuals with special needs are eligible for Supplemental Security Income, or SSI. However, in order to remain eligible for SSI an individual may not have more than $2,000 in his or her own name. This is where a special needs trust can be of benefit. For example, a first-party special needs trust will allow this individual to hold his or her assets in the trust while still remaining eligible for SSI if the assets into the trust are in excess of $2,000. This type of special needs trust is most often used by individuals who are looking at receiving a large inheritance but do not want to lose their access to government benefits.

Providing for a person with special needs can be very challenging, particularly if you are looking at working them into your estate plan. Proper planning and application of trusts can help ensure that even when you are gone, your loved ones are properly provisioned for.