Why You May Need to Consider a Special Needs Trust in Idaho
If you are receiving Title XVI Social Security disability benefits or other needs based disability benefits or if someone you love is receiving such disability benefits, you must take these benefits into account in your estate planning.
What Will Happen if You Do Not Consider Disability Benefits in Your Estate PlanAn individual can only receive Title XVI Social Security Disability Benefits if they qualify financially by having a limited amount of assets. For most individuals receiving these benefits, the medical insurance benefits is the most valuable benefit they receive. The reason the medical benefit is so valuable is because medical expenses are typically the greatest expense a disabled individual has. Without medical insurance, many disabled individuals would not be able to obtain the medical care they need. Thus, it is important to protect these medical benefits. Unfortunately, a well-intentioned but otherwise misinformed relative could cause a disabled person to loose these valuable medical benefits by simply directly leaving this person a few thousand dollars in their will. While this inheritance will not be enough to pay the expensive medical treatment the disabled person is receiving, this amount will certainly be enough to cause the person to no longer qualify for her governmental benefits. At that point, she will not longer receive her monthly Title XVI benefits until she has spent all of the money she received. In the meantime, her medical bills may exceed the amount of money she received leaving her in greater debt and in a worse condition if she had received no inheritance at all.
Leaving Money to a Special Needs Trust Can Protect from this TragedySpecial Needs Trusts are a way for you to leave an inheritance for a disabled relative without disqualifying that person from receiving her Title XVI disability benefits. This special type of trust is drafted so that the funds held in trust can be used to care for and assist a person with disabilities without disqualifying the person from receiving her important governmental benefits. The beneficiary of this trust has no control over the trust nor is she allowed to demand receipt of benefits of the trust. The trustee, however, is directed to wisely spend the money to provide medical care and benefits for the disabled person which the government benefits do not cover (e.g. dental care). The Trustee is typically someone familiar with the disabled person and is aware of her needs. The easiest way to think of it is that the Trustee stands in the place of a parent for the disabled person and provides the type of extra care and consideration that a parent of a disabled child would typically provide. As such, if you are disabled or if you are the parent of a child with disabilities, you should talk to an attorney about obtaining a Special Needs trust to protect you or your loved one so that you or your loved one can be cared for by an inheritance without the risk of loosing your important governmental benefits.
What Can You Do if You are Receiving Disability Benefits and You Are Informed You Have Been Gifted Money in an InheritanceIf you are receiving disability benefits and you learn that you have received an inheritance it is important for you to immediately speak with a lawyer. If there is a chance that the money you receive will cause you to loose your benefits, an attorney can help you avoid this result. The attorney will need to file documents with the probate court notifying the court of your dilemma. A wise attorney will request the Court to place your inheritance into a self-settled special needs trust for your benefit. While you will no longer have control of your inheritance, you can know that the Trustee appointed will have responsibility to see that the funds in this Special Needs Trust are used to benefit you through the remainder of your life.