Creating a will, naming and assigning assets to named beneficiaries is not something most Minnesota residents enjoy doing. While having a will is important for everyone, it is essential if you have a disabled child. At Dunlap & Seeger, P.A., we often assist clients in setting up a trust that ensures their child is taken care of after the parent passes away.
According to U.S. News & World Report, families frequently establish a supplemental needs trust, also called a special needs trust, while the parents are still alive. By choosing this estate planning vehicle, a disabled individual can receive the benefits from the estate without jeopardizing any government aid, such as Medicaid, food stamps or SSI. This is crucial if your child has complex medical problems.
The trust must meet the intricate federal and state rules. Although the trust cannot pay for items such as groceries and living quarters, it can pay for specialized equipment, computers, education and clothing. Depending on your child’s needs, it can also help pay for custodial care. Each situation is unique, which means each trust must be set up specifically for your circumstances.
If the trust is not established correctly and your child becomes your beneficiary rather than the trust, it may endanger his or her public benefits. In many cases, the funds may need to last 30 or more years, which makes appropriate administration essential. When setting up a trust, you must decide if a company or trustee will manage it. Some organizations only work with large sums, while nonprofits may pool trusts of smaller amounts.