Frequently Asked Questions About Special Needs Trusts In Florida
A Florida special needs trust can be an important part of an estate plan. This is a unique type of trust that can help preserve the benefits and financial assistance that a disabled beneficiary needs, while still leaving them an inheritance to help with supplemental costs and expenses. A Palm Beach special needs trust lawyer can help you draft an estate plan that is designed to meet your family’s specific needs.
If you are looking for a Florida estate planning attorney to help with a special needs trust, just call The Law Office of Nicole C. Morris, P.A. Our attorney has more than 19 years of valuable experience and is known for providing creative solutions and cost-effective services. You can meet with us for a free initial consultation, where we can discuss your family’s needs and how to structure your estate plan to meet them. Call today to get the process started.
A Few Answers To Common Questions About These Unique Types Of Trusts
It is understandable that you would have a significant number of questions about drafting a special needs trust, so here, we answer some of the questions our firm hears most often.
How does a special needs trust work?
This is a trust that can hold financial assets that would otherwise be given to a beneficiary as their inheritance. Leaving them the inheritance directly can disqualify them from the governmental benefits they need, like Medicaid, because they would no longer pass the means test. Their asset levels would be too high. But putting the money into a special needs trust means that the beneficiary does not own those financial assets — the trust does — so they still qualify for benefits, and the inheritance can be used for other costs.
What are the trustee’s responsibilities?
When setting up a special needs trust, you choose a trustee who is in charge of administering it. The beneficiary cannot access the account, but the trustee can. It is their responsibility to make withdrawals or payments that are in line with the instructions in the trust and in the beneficiary’s best interests. You set up the trust as the grantor, but the trustee administers it.
How should trust funds be used?
It depends on the specific benefits the person is receiving, but the trust can be used to address things that are not covered. For instance, maybe someone with special needs qualifies for housing assistance or certain types of medical care. But they do not have benefits covering things like cellphone costs, utilities, transportation, food or other necessities. The trust could be used to address these financial needs.
How are first-party and third-party special needs trusts different?
The difference is in who is funding the trust. A first-party special needs trust is typically funded using the beneficiary’s assets, perhaps lowering the value of their own estate so they qualify for benefits. A third-party special needs trust is usually set up by another individual, such as a parent or grandparent, as part of their estate plan.
Will a special needs trust affect eligibility for government benefits, such as SSI and Medicaid?
The goal of a special needs trust is to retain this eligibility. Because the person has to pass the means test, if they simply had the money in a bank account, they would have to spend it down in order to qualify. But by putting it into the trust, they still qualify for benefits, just as they did before.
How often should I update a special needs trust?
A trust can be reviewed and updated anytime there is a significant change in the beneficiary’s life, such as further development of their condition or eligibility for new benefits and programs. It can be helpful to look for these significant changes, or you could simply review the trust along with the rest of your estate plan on a set schedule, such as a biannual review.
Call For A Consultation
If you have any further questions about special needs trusts in Florida, call 561-659-7790 or use the online contact form to set up your initial consultation.