Special Needs Planning

If you have a family member with special needs, you want some assurance that they will be able to enjoy a secure future, even after you are no longer around to support them. While your loved one may rely on government assistance, you may want to provide them with additional financial stability to ensure that they can enjoy a sense of economic security. However, many government benefits adhere to strict limitations and eligibility requirements, which means that any additional income (i.e., an outright gift or inheritance) could jeopardize your loved one’s eligibility for the needs-based assistance they depend on. In other words, simply leaving behind an inheritance or large sum of money for a loved one with special needs may disqualify them from receiving assistance from a government program.

Special needs trusts, also sometimes called supplemental needs trusts, are estate planning tools that can provide financial support to a vulnerable loved one without affecting their eligibility for needs-based government assistance. Essentially, a special needs trust allows the settlor (the person creating the trust) to place assets into the trust for the benefit of your loved one with special needs (called the beneficiary). When you set up a special needs trust, you will designate a trustee to oversee the management of the trust. The trustee has a fiduciary duty to manage the trust’s assets in accordance with the beneficiary’s best interests. Since the beneficiary does not have direct access to the funds in the trust (meaning all matters relating to the special needs trust must pass through the trustee), the assets placed in the trust do not affect the beneficiary’s eligibility for government benefits or forms of public assistance.