Special/Supplemental Needs Trust

Individuals living with a disability often need to avail themselves to public assistance at some point in time.  In order to qualify for this assistance, guidelines require that the individual first be impoverished. The threshold at which someone no longer qualifies for assistance is around $2K-$3K.

Unfortunately, while public assistance may provide certain necessities, it does not allow for the quality of life many of us would like our loved-ones or ourselves to enjoy.  A Special or Supplemental Needs trust can help bridge that gap.

See below a sample of items which could be purchased by a trustee with assets held in trust:

1. medial equipment or treatment not covered by Medicaid
2. Adaptive equipment not covered by Medicaid
3. cell phone and service
4. Hobby supplies and fees
5. tuition and school supplies if no other funding source exists
6. prepaid funeral expenses
7. computer equipment
8. personal care items
9. vacations
10. pet/pet supplies

Things the trustee cannot purchase with trust assets:

1. gift for people that are not the beneficiary
2. Beneficiary’s basic needs, such as food, shelter, clothing and medical care.
3. cash payments directly to the beneficiary

This type of trust can either be self-funded or funded by someone else.  If it is self funded, it is called a Special Needs Trust and if it is funded by someone else, a Supplemental Needs Trust.  The primary difference is that at death, any funds left in a Special Needs trust go to the state or agency to reimburse for care provided.  In a supplemental needs trust, any excess goes to a remainder-man beneficiary defined by the grantor.