There is no cookie-cutter, one-size-fits-all estate plan. Each situation is different, and the people that you love are all going to be in different life situations. You should take the right steps to make sure that each individual on your inheritance list is provided for in the optimal manner. With this in mind, let’s look at special needs planning and the preservation of income.
Government Benefit Eligibility
Many people with special needs are enrolled in government benefit programs that are only available to individuals with very limited financial resources. You may want to help out a love one who is in this position, either while you are living through direct gift giving, or after you pass away through your estate planning efforts.
Under these circumstances, you have to think long and hard because an improvement in financial status can cause a loss of benefit eligibility.
Supplemental Security Income or SSI is a source of monthly income for people with special needs who cannot earn income on their own. This is one benefit that could be lost through a windfall of money, and Medicaid is another one. Medicaid is a government health insurance program that many people with special needs rely upon.
To help a loved one who is enrolled in these government programs without causing a loss of benefits, you could convey assets into a special needs trust. These trusts are alternately called supplemental needs trusts.
You name a trustee when you create the trust agreement, and the person that you want to provide for would be the beneficiary. The beneficiary could not control the actions of the trust in a direct way. However, the trustee could utilize assets in the trust for certain purposes that make the beneficiary more comfortable. As long as the rules are followed correctly, benefit eligibility would not be impacted.
Download Our Free Report
We have provided a bit of basic information about special needs planning in this brief blog post. If you would like to dig deeper, we have a valuable resource that you can access through this website.
Our firm values education, and we have prepared a number of different in-depth special reports that cover many different important estate planning and elder law topics. One of these reports is dedicated to the subject of special needs planning.
There is no charge for this report, and it contains a lot of useful information . To get your copy of the report, click this link and follow the simple instructions: Charlotte NC Special Needs Planning.
Set Up a Consultation
If you would like to take things a step further, feel free to send us a message through the following link to set up a consultation: Charlotte NC Estate Planning Attorneys.
John’s practice focuses on the use of Wills and Living Trusts in Estate Planning to help individuals protect their families and preserve their legacies after their deaths, but his practice also focuses on the critical issues of protecting individuals with dementia or other diminished capacity, assisting individuals in qualifying for Medicaid and other government benefits to offset the costs of long-term care, and providing special needs planning.
John is admitted to practice law in North Carolina, South Carolina, Kentucky, and Ohio, and he is accredited by the Department of Veterans Affairs.
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