Those who have family members who are individuals with disabilities want to plan for the financial security of their loved ones. These individuals usually lack the capacity to manage their own finances, and family members may be looking for means to ensure that their specific needs, lifestyle, and future is cared for. However, family members may also need to ensure that the individual will not lose eligibility for future governmental assistance because of a sudden infusion of assets. One way of accomplishing this is through the establishment of a special needs trust.

If you have a loved one who is an individual with a disability, you may want to consider your options for ensuring their future financial security. You should consult with an experienced law firm such as the Cedar Law Center in the Virginia Beach area, including Norfolk and Chesapeake, to determine whether establishing a special needs trust is your best course of action.

Eligibility Retention

One of the primary reasons why a special needs trust may be the best option in these situations is preserving eligibility for governmental benefits. The possession of some assets may disqualify your loved one from getting Supplemental Social Security Income (SSI), Medicaid, vocational rehabilitation, or subsidized housing. A lump sum payment, such as disbursements from a will, is one such disqualifying asset.

A special needs trust may permit family members to provide for disabled family members without creating eligibility issues. With trusts, a trustee has control over managing trust funds ‚?? not the beneficiary ‚?? and the agencies administering these benefit programs will ignore trust assets when considering an individual for eligibility. While the trustee cannot provide money directly to the disabled beneficiary, the trustee can use trust assets to procure a wide variety of goods and services such as out-of-pocket medical and dental expenses, rehabilitation, personal care services, vehicles, education, home furnishings, etc. These are considered non-countable resources, which are types of property not considered to be a resource by SSI and Medicaid for eligibility purposes.

Resourcesthat may interfere with the receipt of benefits include cash, checking and savings accounts, stocks and bonds, real estate other than the beneficiary‚??s primary residence, retirement accounts, and investment accounts. If these are in the beneficiary‚??s possession and is worth more than $2,000, then the individual is not eligible for SSI.

Community Special Needs Trusts

For those who cannot name a trustee to administer the assets of a special needs trust, or do not have enough funds to justify creating an individual trust, they may be able to use community trusts, also called pooled trusts, managed by nonprofit organizations. These are managed by nonprofit administrations on behalf of beneficiaries who are individuals with disabilities. Assets within the trust are combined and invested together, and funds are spent on beneficiaries in proportion to their share of the total amount.

In Virginia Beach, the Virginia Beach Community Trust is a special needs trust managed by a Board of Trustees made up of five community volunteers that is set up by the Virginia Beach Department of Human Services. They provide families with consultation specifically targeted to the needs of disabled loved ones, and families are not charged an origination fee, or a management fee, for the life of the trust.

If you have a loved one who has a disability and you are considering creating a special needs trust to ensure their future security, the Cedar Law Center in Virginia Beach may be able to assist you. Dedicated to creating sustainable legal solutions for its clients, the Cedar Law Center has years of experience in estate planning, administration, and probate in Virginia Beach, Norfolk, and Chesapeake. Please contact us so we can provide you with sound legal advice and help you determine whether a special needs trust is your best option. You may reach us by calling (757) 963-7788 or by completing our online contact form.


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