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Special Needs Trusts. Presented by: Attorney William J. Brisk Law Office of William J. Brisk 1340 Centre Street, Ste 205 Newton Centre, MA 02459 Phone 617 244-4373; Fax: 617 630-1990 www.briskelderlaw.com billbrisk@briskelderlaw.com. How do you provide for a disabled person?.

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Special Needs Trusts

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Special needs trusts

Special Needs Trusts

Presented by: Attorney William J. Brisk

Law Office of William J. Brisk

1340 Centre Street, Ste 205

Newton Centre, MA 02459

Phone 617 244-4373; Fax: 617 630-1990



How do you provide for a disabled person

How do you provide for a disabled person?

  • Public benefits:

  • SSI

  • Food stamps

  • Housing subsidies

  • Medicaid

Special needs trusts

  • Eligibility for public benefits depends on low income/low resources, generally can’t have more than $2,000 of countable assets. NOT counted, however, are:

  • Residence

  • Clothing

  • Personal effects

  • Certain trusts, i.e. SNT and pooled trust

How are such trusts funded

How are such Trusts funded?

  • By beneficiary him/herself. First Party Trust

  • From own funds or gifts.

  • From tort recoveries. Examples.

  • Created by parent, grandparent, Guardian (??) or by court.

  • By parents, relatives, or friends. Third Party Trusts.

  • Can be funded at any time.

  • Often, however, best funded by “pour over” Will into pre-existing trust (revocable) that can be changed as needs or law change.

Special needs trusts

  • In order to qualify as a Special Needs Trust must include the following:

  • Established by a parent, grandparent, guardian, or by order of a court.

  • Irrevocable

  • Grants Trustee broad discretion over distributing income and principal to the “sole beneficiary.”

Special needs trusts

  • Names a beneficiary who is DISABLED (i.e. must meet SSI standard which is” unable to participate in gainful employment”

  • Must be under the age of 65 when Trust is created!

  • Must explicitly deny right to use funds to cover the costs of food, shelter or housing or allow for setoffs of federal benefits in certain circumstances.

  • Grants Medicaid priority to recover what it spent on the primary beneficiary’s health care before disbursements are made to contingent beneficiaries.

Special needs trusts

  • So what can a SNT cover:

  • Medical care NOT covered by Medicaid, e.g. most dental work, some therapies, elective surgery.

  • Education or educational services & related costs

  • Psychological support services

  • Recreating

  • Clothing (exempted in 2005)

  • Transportation, including a vehicle used for transporting the beneficiary.

  • Telephone and cable TV

  • Electric wheelchair and other mobility aids

Special needs trusts

  • Mechanical beds.

  • Travel, outings, and entertainment expenses

  • Caretakers to accompany beneficiary to such travel, outings, and entertainment.

  • Private rehabilitation services.

  • Private case management to assist beneficiary or to aid trustees in performing their duties.

  • Medication, drugs, or treatment prescribed by a physician or other healing art practitioner for which public benefits do not provide as well as for over-the-counter medication or personal care products.

  • Surgery not covered by Medicaid

  • A principal residence or part thereof allocable to the beneficiary. Issue: is it better to own it outright or hold it in the trust itself?

Special needs trusts

  • Caution. Obtain expert guidance in:

  • Creating the Trust

  • Funding the Trust

  • Filing annual tax returns for Trust

  • For guidance on distributions and management

  • Expertise has expanded since National Academy of Elder Law Attorneys increased its 5,000+ attorneys’ mission to help the disabled as well as the elderly some five years ago. www.naela.org

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