When it comes to planning for the financial well-being and care of a disabled spouse, a commonly used trust is a Special Needs Trust (SNT), also known as a Supplemental Needs Trust. A Special Needs Trust is designed to protect the assets intended for the benefit of a disabled individual without jeopardizing their eligibility for government assistance programs such as Medicaid or Supplemental Security Income (SSI).
Here are some key points about Special Needs Trusts:
- Preservation of Benefits: A Special Needs Trust allows you to provide supplemental support for your disabled wife while preserving her eligibility for government benefits. These benefits typically cover essential needs such as healthcare, housing, and food.
- Trustee: You will need to appoint a trustee who will manage the trust assets and make distributions on behalf of your wife. It’s crucial to choose a trustee who is knowledgeable about the unique requirements of Special Needs Trusts and understands how to use the trust funds to enhance your wife’s quality of life without impacting her eligibility for government benefits.
- Trust Assets: You can fund the trust with various assets such as cash, property, or investments. The assets are then managed by the trustee for the benefit of your wife.
- Trust Terms: The trust document will outline the specific terms and conditions for the distribution of funds. It’s essential to clearly state that the trust’s purpose is to supplement, not replace, any government benefits.
- Permissible Distributions: The trust funds can be used to pay for a wide range of supplemental needs and services that are not covered by government programs, such as education, recreation, therapy, medical expenses not covered by benefits, transportation, and personal care attendants.
- Professional Guidance: It is strongly recommended to work with an experienced estate planning attorney.
