Do you have a loved one with special needs who you would like to provide for well into the future?
October is Special Needs Law Month, highlighting the importance of scheduling a consultation with a trusted elder attorney. There are many different legal needs associated with someone who has special needs concerns, particularly when it comes to remaining eligible for government benefits. For these government benefit programs like SSI or Medicaid, asset and income restrictions must be met by the applicant in order to continue receiving these important benefits.
Giving outright gifts of cash or other kinds of assets to a person with special needs could accidentally disqualify them from these important and crucial support systems. This is why it is often recommended to create a special needs trust with the help of an elder lawyer.
A special needs trust is one that is created using the money of the person who has the disability or having another person use their money to establish the trust for the benefit of the person with disability. These are known as first party special needs trust and third party special needs trust.
One of the most important differences between these two kinds of trusts is that a first party special needs trust, i.e. the one that is created with information from the party with special needs to benefit themselves and a third party trust is that the first party trust has a Medicaid payback provision whereas a third party trust does not.
If you intend to leave behind an inheritance for a person with a disability, it is critical that you understand this distinction and schedule a consultation with a trusted elder law attorney in your area. Our MI special needs law estate planners can assist you.