FAQs

Q: What is a special needs trust?

A: A special needs trust allows a disabled beneficiary to receive funds that would otherwise jeopardize their eligibility to receive governmental benefits such as Social Security Income and Medicaid. Due to the fact that a governmental benefits recipient can only possess $2,000.00 in countable assets, the special needs trust allows excess funds to remain in the trust as an exempt asset, thus preserving the beneficiary’s governmental benefits.

Q: What types of things can a special needs trust pay for?

A: Special needs trusts are designed to supplement, not replace, the support provided by Supplemental Security Income, Supplemental Security Disability Income and Medicaid. They typically pay for things such as independent medical and dental expenses, annual independent check-ups, necessary or desirable equipment (like specially equipped vans), training and education, insurance, transportation, and essential dietary needs. If the trust is sufficiently funded, the disabled person can also receive spending money, electronic equipment and appliances, computers, vacations, movies, payments for a companion, and other products and services that can improve self-esteem and quality-of-life.

Q: What expenses cannot be paid for by a special needs trust?

A: Examples of basic expenses that cannot be paid for by the special needs trust without jeopardizing government benefits include food or groceries, housing, property tax, homeowners insurance or association dues, utilities and/or hook up charges, and cash given directly to the beneficiary for ANY purpose. However, the trustee can use trust funds for food, clothing, and shelter if the trustee decides doing so is in the beneficiary’s best interest, despite the possible loss or reduction in public assistance.

Q: Why choose a professional/corporate trustee?

A: Choosing a professional trustee to administer a special needs trust offers many advantages over choosing a family member. For example, a professional trustee will manage all areas of the administration process, including the monitoring of investments, processing allowable distributions and preparing necessary annual court filings. In addition, public assistance program rules and guidelines are extremely complex and forever changing. Using an experienced, knowledgeable professional trustee ensures that the intricacies of the law are followed, the trust remains compliant and governmental benefits are not compromised.  Furthermore, a corporate trustee lives on in perpetuity. Finally, a professional corporate trustee allows family members to avoid the problems and frustrations that can arise in the day to day administering of a special needs trust, and focus instead on being a loving, caring parent, sibling, grandparent or friend.

Q: What are Trust Protectors and Trust Advisors?

A: For people uncomfortable with having a “stranger” manage their loved one’s affairs, a  corporate trustee and family member can be appointed Co-Trustees. In addition, a Trust Protector can be hired to monitor accounts and oversee the trustee’s actions and duties.  And a Trust Advisor can be put in place to act as liaison between the beneficiary and the trustee to ensure that all personal needs are communicated to the trustee as completely and accurately as possible.