How to Establish a Special Needs Trusts

Special Needs Trusts

It is critical to utilize a Special Needs Planning Attorney to establish a Special Needs Trust for your child as soon as possible, even if he or she is too young to qualify for governmental benefits, and even if you are not sure that your child’s challenges will be lifelong. A "third party" Special Needs Trust can accept gifts and inheritances from family and friends without interfering with your child’s governmental benefits qualification. Gifts or inheritances given directly to the child, outside the Special Needs Trust arrangement, can cause the child to be disqualified for other benefits or require the child to reimburse the state for services received. You may designate alternative beneficiaries in a Special Needs Trust (such as your other children or family members) to avoid having to reimburse the government for services provided to your child. Assets of Special Needs Trusts are also protected in a parents’ divorce, serve as a safe vehicle for divorced spouse’s contributions, and are safeguarded from liability.

Frequently, the individual with special needs has already inherited funds directly, causing them to lose benefits or fail to qualify for future benefits. Our firm can help these individuals regain eligibility by creating a slightly different type of trust called a "first party" special needs trust. Your special needs planning attorney can explain the difference between a first and third party special needs trust, and which one is right for you.

If you have a child with special needs, you may have been given the common advice not to have assets in your child’s name. When a child turns 18, he or she is then a legal “adult” and can then become eligible for various government benefits such as Supplemental Security Income (SSI) and Medicaid (and in some cases, Medicare). However, both of these benefits require that the child own less than $2,000, not just upon turning 18, but for a period of several years prior to reaching age 18, and indefinitely thereafter. This is where the Special Needs Trust comes in as a planning strategy.

Parents, grandparents, and family friends struggle to understand how they can then gift presently or leave assets to the child in the future without causing disqualification for government benefits. Solution: establish a Special Needs Trust. Parents can then also designate a Trustee who can manage the assets for the child, as well as control the distributions and child’s ability to access the funds. Trust assets can then be used to “supplement” the government benefits the child is already receiving to maximize the child’s quality of life.

Testimonials

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“We put off pursuing a special needs trust for our son for years, mainly because we convinced ourselves it would be such a daunting and complicated process. Katie was recommended to us through an organization that services young adults with Autism, so we felt confident that she might understand the journey we’ve been traveling. When we first sat down with Katie, we immediately knew she would be the best person to guide us through what we thought would be an arduous process. The word that best describes our experience is safe. We felt safe with Katie. She provided wise council and many resources to assist in making difficult decisions. All aspects of the process were presented in an organized and systematic way. Katie guided us through the process, which had previously seemed so overwhelming and complicated, in a way that was concise, clear and easy to understand. Most importantly, we trusted that Katie understood our concerns as parents raising a young man with Autism. We walked out of her office feeling confident we had coordinated the best plan for our son’s future, and highly recommend her services to anyone looking for an experienced guide to walk them through the estate planning process.”

- S. Family

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“When you have a loved one with disabilities, it is so important to find someone who specializes in special needs Trusts and Wills and other important issues so you can plan for their future. Katie Clancy was gracious enough to come out to our Parent Support Group of parents with disabled children and adults (more than once) and take the time to explain our options and answer our questions. She was so knowledgeable and personable. She helped so many of us. I highly recommend Clancy and Associates."

- S. Linden, Director of Elmhurst Parent Support Group

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“We had the pleasure of meeting Katie Clancy who came to speak to our families here at Easterseals DuPage and Fox Valley. She presented at various times to accommodate our families’ work schedules. I found, as did the families who attended, that her presentation was clear, factual and easy to follow. She stayed and answered all questions the parents had – Katie has been a great resource to our families!"

- Sharon Pike, Parent Liaison Easterseals DuPage & Fox Valley

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“Katie is knowledgeable and easy to talk to. We can breathe easier knowing that we have a plan in place so our child with special needs will be properly taken care of when we are gone. Appointments were simple to schedule and she traveled to meet with us at our financial advisor’s office and at our home. I refer all of my fellow moms who have children with special needs to Katie.”

- Bill & Lori G.

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“Katie Clancy was highly recommended to us by our son’s SSI Appeals Attorney. We knew it was critical for us and for our family to update our 14 year old Estate Planning and Special Needs Trust but we didn’t have the energy or appetite to go through the complicated process again. Working with Katie Clancy made all the difference. She helped us understand current government benefits that were available for our son, provided invaluable suggestions and revisions that addressed life planning needs and guidance on how to write a Letter of Intent. The whole process of updating our Estate Planning and Special Needs Trust has tremendously relieved our stress and anxiety over our son’s and daughter’s financial future and well-being.”

- G. Family

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