Special Needs Trusts

Special needs trusts serve the needs of families requiring adult beneficiaries to be cared for beyond a caregiver-testator’s life. The trust can be created so that an executor is appointed to oversee distribution of funds and the well-being of the special needs beneficiary. If you care for a loved one with a permanent physical or mental disability requiring specialized, long-term care, you should consider creating a special needs trust to protect their interests after your passing. Aside from express wishes in your will, a trust is the only legal document you can draft that explicitly dictates how your estate and resources are distributed to named beneficiaries, including loved ones with special needs.

Trust Formation

Forming a trust requires planning and resourcefulness. With the help of a trusts and estates attorney, testators can designate a trustee and a substitute trustee, determine what assets will be allocated to the special needs beneficiary and how, and how business assets and real property will be wound up, sold, or held in escrow. After the testator’s death, the trustee is responsible for managing the trust fund, including paying maintenance fees, consulting with an accountant, ensuring funding reaches the beneficiary’s account, and most importantly, that the beneficiary receives the care they need.

It’s critical that the testator explicitly states how funds should be used and how much is to be distributed on a monthly, semi-monthly or quarterly basis so that the beneficiary does not exceed the threshold for benefits and assistance. Disability and special needs trusts can also be utilized to limit fiscal resources of the dependent beneficiary, only so the beneficiary remains eligible for state medical assistance and additional programs. The trust also protects the beneficiary’s eligibility for SSI, social security income, or permanent disability benefits, if they are eligible. Otherwise, if the beneficiary inherits the estate in total, they may be subject to inheritance tax, and their net income would exceed the threshold for benefits determinations.

Benefits of a Trust

Testators have the option to designate a loved one or family member as a trustee, but it is a dutiful responsibility. The other option is to select a professional trustee, such as an accountant or attorney. Our office can help testators vet and choose a trustee to monitor the trust account. Trusts are also protected from probate and therefore protected from public scrutiny or an open hearing. Setting up a trust prior to passing also gives the testator more control and ability to prepare for the unknown or unexpected while they are still living. While it may seem complicated, establishing a trust for a loved one with disabilities or special needs is the best course of action to ensure their future is protected and their needs are met, while limiting costs and confusion after an estate is closed.

Schedule a Consultation Today

If you are worried about what the future holds for your loved ones requiring special care, you should seriously consider establishing a special needs trust. Our Tampa estate planning attorneys at Bubley & Bubley, P.A. have experience in the formation of estates and trusts, and we can assist you throughout the process. Call us today to schedule a consultation.

Resource:

flsenate.gov/Laws/Statutes/2018/736.0801

https://www.bubleylaw.com/appointing-a-guardian-for-minor-children-in-florida/