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Modern Estate Planning Blog

Elder Law & Special Needs Planning

Sacramento Special Needs Trust Lawyer FAQs

September 4, 2015

For families who have members with special needs, it can sometimes feel like life is all about asking questions. Sacramento special needs trust lawyers are well aware of this and are committed to helping clients find the answers and to develop workable solutions. A number of questions come up repeatedly, so here’s a little information to get the ball rolling before calling a special needs trust lawyer in Sacramento.

Special Needs Trust Question #1: Why do we need a special needs trust?

A special needs trust is a very specific tool that families use to provide for members with disabilities once the creator of the trust cannot. There are lots of advantages to placing assets into this type of trust, which is to be used for the care and living expenses of the disabled individual. One of the biggest of these, one that a Sacramento special needs trust lawyer will bring up again and again, is the fact that putting assets into a trust rather than willing them directly to the individual will keep the assets from being considered when an accounting is done to determine qualification for many government benefits. Unfortunately, if the disabled individual has too many assets in his or her name, they can become ineligible for a number of benefits that really are necessary, such as SSI, Medi-Cal, or Section 8 housing.

Another truly beneficial aspect of a special needs trust is that since the assets aren’t counted against the disabled individual, they’re also not vulnerable to creditors. So, if the individual ends up in debt or is sued for some reason, the money in the trust is safe.

Special Needs Trust Question #2: How can the assets of the trust be used?

There are some restrictions on how the funds/assets can be used, and a Sacramento special needs trust lawyer will go through them thoroughly with you. Many of the restrictions relate to the above section regarding qualifying for government benefits. Restrictions sometimes include not being able to use the trust to purchase groceries or pay rent, but these rules tend to have different interpretations, and the special needs trust lawyer is someone who can help clarify each of them. In a nutshell, the trust isn’t just about providing the necessities, it’s about supplementing them with experiences, activities, and other aspects of living that enhance the individual’s life.

Special Needs Trust Question #3: Wouldn’t it be better to leave the money to the individual’s caregiver?

With the idea of avoiding issues caused by leaving funds to a disabled child, parents often decide to leave it to a caregiver (often a sibling) instead. This is something that special needs trusts lawyers DO NOT recommend. There are many reasons that this approach is damaging, including the potential for taxes, a possibility that the money will still be counted against the disabled individual, a possibility that the caregiver will use the funds as his/her own, and that the caregiver’s spouse could legally end up with all or some of the money should a divorce ensue. The money is also not protected in the same way against creditors if it isn’t put into a special needs trust.

Families of those with special needs often feel like life is just one big question after the other. Fortunately, a Sacramento special needs trust lawyer will have a lot of answers that can bring you peace of mind.

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Very professional, comprehensive service and extremely valuable. Heather and her team are very knowledgeable and we feel they have our best interests at heart. They make uncomfortable decision conversations possible and manageable. Working with Heather we were able to focus our attention on important issues that we questioned or purposely avoided for too long. Now that these questions are answered and our family is covered, it's a wonderful feeling.

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