Encino Special Needs Trust Attorney
There are various reasons why individuals set up trusts, just as there are various types of trusts one can set up. Some Trusts allow for a separation between enjoying the advantages of using and enjoying assets while someone else manages and controls the same assets.
Certain trusts can be useful when a person needs to qualify for certain government benefits. To learn about this option, contact a special needs trust attorney at the Law Offices of Andrew Cohen.
What is a Special Needs Trust
Individuals with various types of disabilities may sometimes receive government benefits or assistance. However, in order to qualify for such benefits, it is often necessary for the individual to own few assets. Decisions regarding who does and does not qualify for such government assistance programs often treat the financial circumstances of an individual with a disability as a very significant qualifying factor.
At times, people with disabilities may need someone to establish a special needs trust on their behalf. If they will need to receive government benefits, but they may own assets whose value is such that it would disqualify them from eligibility for government assistance, those assets may be placed into a special needs trust on behalf of the beneficiary.
Types of Special Needs Trusts
If you are considering setting up a special needs trust so that your loved one may qualify for government benefits, it’s important to be familiar with the three relevant types. They are:
- First-Party Special Needs Trust: Someone with a disability would use their own money and assets to set up this type of special needs trust for themself. Additionally, any assets placed in this trust must initially be used to repay government benefits the individual received should they pass away. This type of Trust often needs court approval to establish and implement
- Third-Party Special Needs Trust: The family members of a disabled individual would set up this type of special needs trust for them. The property placed in the trust cannot belong to the disabled beneficiary. However, with this type of trust, if the disabled beneficiary dies, those who established the trust are not required to pay back any benefits they received.
- Pooled Special Needs Trust: Some nonprofit organizations pool multiple special needs trusts together. They manage all these trusts, and the trusts can be either first-party or third-party trusts. In exchange for these services, the nonprofit will receive a portion of the trust proceeds when the beneficiary passes.
Contact an Encino Special Needs Trust Attorney Today
It’s important to make sure the attorney handling your matter is experienced. We can discuss in greater detail whether this is the ideal option for your needs and goals.
If you do set up a special needs trust, it’s critical to ensure the trust is worded properly for it to be valid under California law and avoid disqualification of government benefits. This is an important reason to coordinate with the experts at an Encino special needs trust law firm.