Planning for a loved one with a disability can be a challenge. Katten & Benson can help you structure your estate plan to provide for a disabled beneficiary, without disqualifying such person from benefits. We can also assist you in navigating the maze of benefits available, and troubleshoot issues as they come up. Listed below are some of the tools we can discuss with you.
Supplemental Needs Trust
A Supplemental Needs Trust (SNT) is a vehicle to be able to save funds for a disabled beneficiary without disqualifying that person from means tested benefits (such as SSI or Medicaid.) There are several different kinds of SNTs, depending on who creates the Trust, and how and by whom it is funded. For example, a SNT could be created for the disabled child John by John’s parents. John’s parents can contribute to the Trust while they are alive, and designate the Trust (rather than John) as a beneficiary in their Wills. In addition, any other family members, such as grandparents, who want to help pay for John’s care can designate the Trust for lifetime gifts or in their Wills.
Suppose this planning was not done ahead of time, and John, who is now an adult and on SSI, receives an inheritance. Katten & Benson can help John’s parents, guardian or caretakers choose which kind of Trust is most appropriate for him, and help get John qualified without losing his SSI benefits.
Sometimes, a situation arises where a beneficiary may have too much money to qualify for public benefits. A pooled trust may be the solution. A pooled trust is a SNT that is run by a separate agency, where each beneficiary has a sub-account. These Trusts can be less expensive for the beneficiary. Katten & Benson can help determine if this is an appropriate vehicle for a disabled beneficiary.