A special needs trust is a type of estate planning tool that can be used to help beneficiaries that are disabled or have other special needs. This type of trust has been known to be confusing and most people have several questions when trying to implement one. Here are a few of the most frequent asked questions when dealing with a special needs trust.

Why Use a Special Needs Trust?

The special needs trust is a way that you can ensure that your beneficiaries with special needs are taken care of once you are gone. Many times, parents of special needs children spend the majority of their time and resources taking care of these children. The thought of what would happen to the children after the parents pass away is often a source of unrest for these parents. By implementing a special needs trust, you can set aside assets so that your children will be taken care of when you are unable to do so.

What Does a Special Needs Trust Have to Say?

Within a special needs trust, there are several things that you are going to need to include. You need to say that the trust is going to provide supplemental and extra care about what the government is providing for the individual. You also need to state that this trust is not designed to be a basic support trust. The trust should also mention the Social Security Operations Manual which helps to justify the creation of the trust. You will also want to reference the exception to the Omnibus Budget and Reconciliation Act as this provides more justification to create the trust. Most of this is very technical in nature and you should most likely refer to an estate planning attorney for this portion of the document.

When Should We Create the Trust?

Ideally, you should set up a trust as soon as you possibly can. You never know when you could pass away suddenly and your beneficiary would not be taken care of. You can technically set up this type of trust anytime before the beneficiary turns 65. Many people set these up while the beneficiaries are still children.

How Can You Fund a Special Needs Trust?

There are many different ways that you can fund a special needs trust. Practically any type of asset can be included into the trust as a way to fund it. You can include insurance payments, Social Security disability payments, real estate, investments or practically anything else that you can think of.

Should We Hire a Lawyer?

There is no right or wrong answer as to whether you should hire a lawyer for the creation of your special needs trust. However, due to the technical nature of this type of document, you should definitely consider hiring a lawyer. They are going to have a lot of experience and knowledge that they can offer you to assist with this process. When looking for a lawyer, you want to make sure that you hire one that specializes in estate planning.

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