When planning your estate, you have to make a conscious and deliberate decision about how you leave your assets or funds to beneficiaries in New York. If you have a special needs child or someone under your responsibility, you may want to consider a special needs trust. This can be a protection for those who may qualify for government assistance.
CNBC explains that a special needs trust provides supplemental coverage for needs that SSI or Medicaid cannot cover. For instance, recreation expenses, dental costs and vision checkups may need extra funds. The problem with giving a person these funds directly is that it can count towards his or her income. Medicaid and SSI are very specific about the amount of money a person can make. A trust protects those funds and the government cannot count that money as income. The federal requirements will not allow a person to have more than $2,000 in assets.
When it comes to establishing a special needs trust, you can choose how much you add to it. There are no minimum amounts. You can fund the trust with your assets, with inheritances or with life insurance policies. Some will add tens of thousands of dollars whereas other families may add millions of dollars. In addition to protecting the money from the government, you can also use the trust to ensure that no one abuses the disabled person’s finances. There is an oversight in place to ensure that your child has the finances and can spend them wisely.
The above information is for educational purposes only. It is not to be interpreted as legal advice.