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Special Needs Trusts. The Arc of Northern Virginia. What Is A Special Needs Trust?.

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special needs trusts

Special Needs Trusts

The Arc of Northern Virginia

what is a special needs trust
What Is A Special Needs Trust?
  • This is a trust designed to provide benefit to and protect the assets of a person with a disability and still allow the individual to be qualified for and receive government benefits; especially Medicaid and SSI.
why do i need a special needs trust
Why Do I Need A Special Needs Trust?
  • In the commonwealth of Virginia, many public services you or your loved one receive or one day will need are tied to Medicaid and Social Security Eligibility.
  • Medicaid and Social Security have limits on what you can earn each month and save in a savings or checking account.
  • If you go over these limits, services can stop.
why the purpose of a special needs trust
Why the purpose of a Special Needs Trust?
  • Provides a management to meet the needs of the Beneficiary which may arise and cannot otherwise be met by the beneficiary's personal resources or benefits.
  • Promote the dignity, comfort and happiness by providing supplemental care, treatment not otherwise covered.
who is eligible for a special needs trust
Who is Eligible For A Special Needs Trust?

Anyone with a physical, mental or intellectual disability; as defined by the Social Security Act

Elderly;

Receiving Medicaid or Disability Income

types of special needs trusts
Types of Special Needs Trusts

Self-Funded Trusts

D4 (a) - Private

D4(c) - Pooled

Third Party Trusts

funded

unfunded

self funded trusts d 4 a
Self-Funded Trusts – d 4 (a)
  • Established by the parent, guardian
  • Funded by the individual
  • For the sole benefit of the individual
  • Created by a private attorney or institution
self funded trusts d 4 c
Self-Funded Trusts – d 4 (c)
  • Established by the parent, guardian or the individual;
  • Funded by the individual
  • For the sole benefit of the individual
  • Established with a Pooled Trust Program by utilizing a Master Trust Document and Joinder Agreement
what is a pooled special needs trust a k a d4c
What Is A Pooled Special Needs Trust (a.k.a. d4c)
  • Managed by a Non – Profit organization
  • Funds from individual participants are pooled for fee and investment purposes
  • Fees are calculated based on the total amount of pooled funds
self funded trusts
Self-Funded Trusts
  • Most Self-funded accounts are established due to:
    • A personal injury settlement
    • An inheritance
    • Any other money that threatens benefits
self funded trusts11
Self-Funded Trusts
  • Upon the beneficiary’s death; remaining funds in the account are subject to a Medicaid Payback Provision.
third party trusts unfunded or funded
Third Party Trusts –Unfunded or Funded
  • May be setup by parents, grandparents, siblings, aunts and uncles or friends.
  • Used frequently to by parents to plan for the Future:
    • Set up as part of your estate planning process to protect assets and services that your loved one is receiving.
    • Avoid probate to have funds available immediately.
    • Ensure your loved one has a way to obtain the items, services or the extra’s you want to make sure they have.
    • These can be funded during your lifetime or left unfunded until your passing.
third party trusts unfunded or funded13
Third Party Trusts –Unfunded or Funded
  • May be established by a private attorney or institution.
  • May be established as part of a pooled trust program
why choose a pooled trust
Why Choose A Pooled Trust?

Pooled trusts are administered by non-profit agencies - professional staff, greater sensitivity and individualized services.

Pooled trusts offer professional investment management by a bank.

There are no minimum or maximum funding requirements

They are more affordable for families or individuals

what can i use the trust for
What Can I Use The Trust For?
  • Dental Care Costs
  • Trips – visiting siblings; going to the beach
  • Renting a tux for a cousin’s wedding
  • Pre-need Expenses
  • Anything not covered by Medicaid or SSI
what can the trust not be used for
What Can The Trust Not Be Used For?
  • Recipients of SSI cannot use the trust to pay for food and shelter; including electricity, gas and water bills, property taxes, homeowners insurance and condo association fees.
  • For self Funded account holders, the trust cannot pay for burial or funeral expenses for the beneficiary once they pass away.
  • The Trust can not hold loans
  • The Trust can not pay cash to the beneficiary.
  • The trust cannot make gifts or use funds for anyone other than the beneficiary
how do i access the funds once they are in the trust
How Do I Access the Funds Once they are in the Trust?
  • Easily. You complete a simple disbursement request form stating the purpose of the request, amount of the request and to whom to send the check.
  • In many cases, supporting documentation is needed, such as a receipt or bill.
  • Then send the request form to The Arc.
  • We understand that everyone is different and we can be creative in accessing funds in other ways as well; such as direct bills.
how much does it cost
How Much Does it Cost?
  • The establishment fee for the Special Needs Trust with The Arc of Northern Virginia is $1050.00.
  • The annual fee for an unfunded account in $65.00 until the account becomes funded.
  • The Foundation of The Arc of Northern Virginia bills 75 basis points annually of the individuals account. (.0075%) (subject to change)
  • SunTrust Bank bills 90 basis points annually. (.0090%) (subject to change)
why choose the arc of northern virginia
Why Choose The Arc of Northern Virginia?
  • The Arc of Northern Virginia has been a leading advocate for individuals and families with disabilities for 45 years.
  • We have the knowledge, expertise, and sensitivity to meet your needs.
  • Our pooled trust has been in existence for over 8 years.
  • To date, our trust currently manage over $3.2 million dollars with $2 million in future dollars
  • We have experts available with whom we consult about changes in regulations.
  • We bring you this service in partnership with SunTrust Bank, a leader in the financial services industry.
why do i need to plan
Why Do I Need To Plan?

We are all fortunate to be here today…

But what about tomorrow…