Special Needs Trust
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As a person responsible for the well-being of a special needs child, you must be concerned about meeting the child’s interest after you’re gone. What should you do to ensure the child receives the government benefits?
Well, you need to consult Special Needs Trust attorneys who can plan and draft a desired Special Needs Trust for your loved ones. Let’s understand the concept of Special Needs Trust Miami Fl from inside and out.
What is Special Needs Trust?
A Florida Special Needs Trust is essentially a form of Irrevocable Trust. It facilitates supplemental care and life-enhancing services and equipment including the benefits provided by the government.
It can also be defined as a trust that includes provisions designed to protect a physically or mentally disabled trust beneficiary’s eligibility for need-based government benefits such as Medicaid or Supplemental Security Income.
Therefore, you need a Special Needs Trust Miami Fl for your loved ones with special needs to ensure their government benefits. We have seen several cases where programs like Medicaid put a limit on the amount of money that a special needs person can earn or inherit and also on the amount of money they can keep in their bank account.
Special Needs Trust, drafted by an experienced attorney, can help provide your special needs child or loved one with the governmental benefits and assure the required legal support.
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How does Special Needs Trust work?
Special Needs Trust should be approached as a legal tool that allows special needs persons and individuals to manage their assets without jeopardizing their eligibility to receive government-funded assistance programs, mainly Medicaid and Supplemental Security Income or SSI.
There are three different parties involved in a typical Special Needs Trust — 1) the Settlor, 2) the Beneficiary, and 3) the Trustee. We will be discussing these parties in detail in the upcoming sections.
Besides the parties, you must know the different types of Special Needs Trust, i.e., First-Party and Third-Party Special Needs Trust. Let’s dive deeper and understand how Special Needs Trust work
Which parties are involved in Special Needs Trust?
Before we discuss the different types of Special Needs Trust and how it works, let’s discuss the parties involved in the process of drafting and administering the same. There are three parties involved in a typical Special Needs Trust Miami Fl scenario —
1. Settlor
This is the person or party that will be funding the trust. A settlor will make sure the trust is funded with money, stocks, property, or other assets. The decision to place such funds in the trust is made by the settlor while it is still alive or can make an arrangement for disbursement after its death. However, the documents drafted for these scenarios are different.
2. Beneficiary
The most critical part of the Special Needs Trust process is the beneficiary. The beneficiary is the special needs person or mentally/physically impaired person who will receive the funds that the settlor has put in the trust. You will need a Special Needs Trust attorney because the beneficiary is not allowed direct access to the funds.
3. Trustee
Trustees for the Special Needs Trust cases are people chosen by the settlor to ensure that the beneficiary receives the funds. The trustee will be part of the case as the person will have to handle the funds and is responsible for the proper distribution of the assets to the special needs beneficiary. The distribution of funds is governed by the trust document.
What are the types of Special Needs Trust Miami Fl?
There are two basic types of Special Needs Trust, which we will discuss here in detail.
1. Third-Party Special Needs Trust
Many times, parents and grandparents draft a revocable living trust for the beneficiary which will require a special needs article. While drafting a Special Needs Trust document in Florida, one should abide by the rule that the special needs beneficiary is not entitled to demand income or principal from the trust. However, you can always make amendments to your existing will or trust to ensure benefits for the special needs person.
2. Self-Settled Special Needs Trust
One of the most practical situations for using a self-settled Special Needs Trust is when special needs persons wish to differentiate newly acquired assets from benefits provided by Medicaid. Filing for a self-settled Special Needs Trust requires an in-depth understanding of how the Special Needs Trust Miami Fl works. Therefore, we highly recommend you consult an experienced attorney.
Drafting and administering a Special Needs Trust
What does it take to draft and administer a Special Needs Trust document and case successfully? Well, the document must clearly express the settlor’s intent to provide funds to the special needs beneficiary in a way that does not jeopardize its eligibility for government-funded benefits.
At the same time, the document should meet the technical criterion to ensure the funds the beneficiary can receive are not restricted by state-run assistance programs like Medicaid. The trust agreement should claim that the settlor trusts that the mentioned trustee has the right to observe the distribution of the funds to the beneficiary.
Trustee is a critical part of the legal process as it possesses the most responsibility. In case the beneficiary’s benefits are not delivered in the legal process, the trustee is personally liable for improper Special Needs Trust Miami Fl administration. You will require a professional trustee who can ensure the best results for the Special Needs Trust case and provide the special needs beneficiary the funds and assets it deserves.