Establishing a Special Needs Trust for a loved one ensures allows you to think about their needs, including the importance of maintaining eligibility for government benefits. Lawyers explain how a trust can be customized to address the particular needs and circumstances of the individual it is established to benefit.
Tailored to The Needs of a Dependent
A Special Needs Trust is also sometimes referred to as a Supplemental Needs Trust, or simply an SNT. As experts explain: “In planning for an individual with special needs, money is not everything — there may be residences or programs that require the person with special needs to be eligible for benefits such as Medicaid or SSI and do not accept private payment. A SNT allows the beneficiary to have the best of both worlds.” Attorney Leigh Hilton points out that care in crafting how the SNT is established ensures that is tailored specifically to the circumstances of the individual it is set up to assist:
A special needs trust is created while you are living and is 100% customized to the dependent with a disability’s individual needs. It provides a child with their own share of the inheritance and gives them the ability to pay for future care and services that may or may not be covered by government benefits, including:
Travel costs associated with medical appointments
Additional medical care
…A parent or guardian can also make it possible for a beneficiary with a disability to receive assets without threatening…eligibility for government programs or benefits….There may be language that says, “trust funds may not be used to pay for any medical expenses that are covered by Medicare or Medicaid.” What that does is exclude the funds in the trust from being considered when determining eligibility for Medicare or Medicaid.This leaves their funds available for the other needs mentioned above that are not covered.
When working with a lawyer to establish a trust, it’s important to incorporate as much detail as possible about its purpose and terms into the trust agreement. Then consider the qualities, skills and time commitments a trustee will need to successfully administer it. Learn more about the essential duties of trustees right here. When a trust is being established for a loved one with special needs, extra diligence in the selection of the trustee is advised. Ultimately, whether a professional, friend, or relation is selected, the trustee has a fiduciary obligation to the beneficiaries—and must always exercise reasonable care and skill in managing the assets of the trust. Accordingly, the trust agreement may require a trustee bond, which is a specific type of fiduciary bond that protects the interests of the trust and its beneficiaries in accordance with applicable state law.
Essentially, trustee bonds guarantee the faithful performance of the trustee. As a leading national provider of many types of fiduciary bonds, Colonial Surety makes it easy and efficient to obtain a trustee bond. Just get a quote online, fill out the information, and enter a payment method. Print or e-file the bond from anywhere—even the law office. Obtain a Trustee Bond Here.
If establishing a trust for a loved one with special needs is on your family’s to do list, but you are finding it hard to get started, you may find the steps Leigh Hilton suggests especially helpful:
First, you need to gather together your financial information and a brief family history.
Second, you need to sketch out your wishes for your special needs trust. This includes making decisions on the amount of financial support your child with special needs will require over his or her life, protecting his or her governmental benefits, and how your other children fit into your estate plan.Third, you need to decide who will manage your child’s finances. Other than deciding to create a special needs plan, this is your most important choice. When you create a special needs trust, you will need to name a trustee or trustees to manage the trust assets for the benefit of your child. Choose someone you know who cares about your child and who is willing to assume the responsibilities of caring for him or her.
In addition to providing bonds directly to the general public, Colonial offers The Partnership Account® for Attorneys . This free business service provides user-friendly client management dashboards, enabling attorneys to easily coordinate, view, complete and e-file the court and fiduciary bonds clients need. See for yourself today: The Partnership Account® for Attorneys.
Colonial Surety is rated “A Excellent” by A.M. Best Company, U.S. Treasury listed, and licensed for business everywhere in the USA. Our customers have awarded us a 4.8 Trustpilot score.
Whenever and wherever you need a bond, trust Colonial: www.colonialsurety.com