Special Needs Planning

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Special Needs Trust
If you are the parent, guardian, or sibling of a disabled person—or are disabled yourself—planning ahead is especially important. A special needs trust (SNT) allows you to set aside money for the care of a disabled individual (or your own care if you are disabled), without rendering the disabled person ineligible for any public assistance to which he or she may be entitled.

Simply knowing that you have made arrangements to ensure your disabled child or dependant is well cared for after you are gone can ease your mind. If you yourself become disabled, we can often help you extend your own resources by using an appropriate trust.

Two Types of Special Need Trusts
There are two types of special needs trusts in Virginia, Maryland, and Washington, D.C. Both require a trustee who is not a beneficiary to administer and manage the trust estate:

  • Third-party SNT—This type of trust is usually created by a parent or other relative of a disabled person as part of a will or living trust. It can be revocable or irrevocable, and each is subject to specific tax regulations and other rules. The third-party SNT does not rely on the assets of the disabled beneficiary for funding. It is funded solely by the trust creator, or grantor.
  • Self-settled trusts— A self-settled trust is a trust funded with the disabled person’s resources. It must adhere to specific requirements or it may adversely affect eligibility for certain public benefits. Virginia, Maryland, and Washington, D.C. allow the use of two different types of self-settled trusts: the (d)(4)(A) trust and the pooled trust. This type of trust is helpful when there is an unexpected inheritance or medical malpractice or personal injury award.

We can help you establish the right trust to protect your loved one or yourself.

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