Estate planning encompasses a lot of different aspects of not only the distribution of your assets, but also how you and your loved ones will be cared for. It’s therefore important that you identify what your goals and visions for the future are so that you can develop the holistic estate plan you need to bring that future into reality. When it comes to ensuring that a loved one is properly cared for in your absence, then, you might want to consider a special needs trust.
A special needs trust allows you to put assets away for the benefit of an individual who needs significant medical care. The biggest benefit of this kind of trust is that the assets passed down to your loved one don’t count against them when it comes to qualifying for public benefits like Medicare, Medicaid, and Social Security disability. There are restrictions on how trust funds can be used to retain exempt status, though, which means they generally must be used for some purpose related to care and treatment.
There are other benefits to a special needs trust, too. For example, these trusts are irrevocable, meaning that they are permanent and cannot be modified in any way once created. Assets also can’t be removed from the trust one placed within it. The benefit here is that creditors cannot reach irrevocable trusts, and these trusts are immune to judgments as well. Therefore, an irrevocable trust like a special needs trust is the best way to protect resources for your loved one’s future care and treatment.
All estate planning documents, including special needs trusts, have to be drafted with care. This is the only way to ensure that they are legally valid and that your intentions are clear. Again, a special needs trust might only be one aspect of your holistic plan. Your unique set of circumstances justifies something better than a cookie cutter approach to estate planning, too. Therefore, to achieve the best outcome possible, consider discussing your vision of the future with an estate planning attorney of your choosing.