Throughout New York, some people spend their lives taking care of disabled family members. If you’re caring for a disabled member of your family, you don’t want this care to end after you pass away. Fortunately, special needs trusts can help you achieve this important goal.
What are special needs trusts?
A special needs trust is a vital part of estate planning for people with disabled family members. These trusts allow someone with a physical or mental disability to receive money without disrupting the income they receive from their assistance-related disability benefits.
How does it work?
These types of trusts are legal arrangements. This arrangement doesn’t mean a disabled person gets immediate access to all of the money in their trust. Instead, a trustee can spend assets inside of a trust. The assets inside a trust typically help pay for out-of-pocket medical costs and rehabilitative expenses.
Can it end?
It’s possible for the termination of a special needs trust to happen. This type of trust will end when the trust runs out of funding. Termination can also happen if a disabled person either doesn’t need their government benefits or no longer qualifies for them. Lastly, it can also end upon the beneficiary’s death.
In closing, a special needs trust is a smart way to protect a disabled person financially without costing this individual their benefits. You’ll need to establish this type of trust before the disabled individual in your life reaches the age of 65. But it’s generally best to set up the trust as soon as possible.
