Woburn Special Needs Planning Attorney
If your family includes a child or other relative who is disabled, you may be surprised to find out that your situation isn’t unusual. According to the CDC, 26 percent of adults in the U.S. (one in 4) have some type of disability. It’s important to put a plan in place so that you can protect your loved one’s present and future lifestyle.
Types of Special Needs
There are four categories of special needs:
- Physical special needs such as muscular dystrophy, chronic asthma, epilepsy, or congenital defects
- Developmental special needs such as Down syndrome, autism spectrum disorders, dyslexia, cerebral palsy, or fetal alcohol syndrome
- Mental health special needs including attention deficit disorder (ADD), attention deficit hyperactivity disorder (ADHD), bipolar disorder, or schizophrenia
- Sensory impairment such as blindness or deafness
There are people with minimal disabilities who can lead relatively typical lives with help from appropriate medical, educational, and/or mental health support. There are also many people who have more severe disabilities, making them unable to work or even socialize. Some may require assistance with daily household or hygiene tasks, and others may need long-term constant care. In most cases, people with special needs will require some measure of financial support.
Special Needs Trust
A special needs trust, also known as a supplemental trust, is established to hold money intended to enhance the life of your loved one while protecting their eligibility for government programs meant to protect them. There are two types of these trusts:
- Third-party trusts are established by a parent or loved one for the benefit of a special needs child.
- Self-settled trusts are created with the child’s own assets, often an inheritance or settlement.
As an experienced Massachusetts special needs trust attorney, Matthew Karr will help you pick the most dependable person as a trustee. In the trust document, you provide directions to the trustee as to how the money in the trust is to be distributed. The trustee will then be tasked with managing the flow of the trust’s assets to meet your loved one’s needs.
Benefits of a Special Needs Trust
A special needs trust is irrevocable, meaning you (the person who created the trust) will have no access to the money it holds during your lifetime. This trust will:
- Protect your funds from taxation, creditors, and judgments against you
- Provide funding for “extras” for your special needs loved one like going to the movies or travel
- Keep your loved one’s eligibility for one or more of the following government-funded programs:
-MassHealth (a government program that provides health insurance to people with disabilities)
-Supplemental Security Income (SSI)
-Social Security Disability Income (SSDI)
-Federal Food Stamps and housing subsidies
This means that government programs will cover doctor visits, prescription drugs, hospitalizations, and a stipend for rent and food, while the funds in the special needs trust will be there to cover things like:
- Private transportation costs
- Treats, day trips, entertainment, short vacations
- Extra clothing
- Pet costs
- Computer equipment
If your loved one with special needs receives an inheritance, a monetary gift, or a personal injury settlement, the special needs trust is the perfect place to hold that money because your loved one can continue to receive the government benefits they need.
Funding the Trust
A trust is basically an empty box that must be filled with assets. Families must consider how to fund the trust and at what levels. Funding must be realistic in relationship to the needs of the loved one. If a family doesn’t have enough resources to adequately fund a trust, one option may be to consider funding it with life insurance.
Contact Us Today to Take Care of Your Loved One
The beauty of a special needs trust is that it enables government programs to take care of your loved one’s basic needs while the trust provides for all the extras that make life more comfortable and fulfilling. If you want to make sure your loved one will be well provided for, contact our knowledgeable Massachusetts special needs trust lawyer today.