Estate planning allows you to plan for the future. This also means planning ahead for your loved ones. This is especially important for those who provide for a loved one with special needs. Unfortunately, simply including this loved one in your will may not be enough. In this case, you may need to create a special needs trust. Read on to learn more about special needs trusts, the different types, and how they can help you support your loved ones in the future.
Why Create a Special Needs Trust?
Creating a special needs trust allows an individual to benefit from certain resources without being discontinued from receiving support from other government programs and public benefits. This can include Supplemental Security Income (SSI) and Medicaid (Medi-Cal). Additionally, there are certain benefits that come with creating a special needs trust for families. This may include:
- Protected government benefits
- Provide supplemental funds
- Avoid probate
- Provide for funeral arrangements
- In-Home Support Services
- HUD housing assistance
Are There Different Types of Special Needs Trusts?
There are three different types of special needs trusts available to individuals in California. These are as follows:
- Third-Party Special Needs Trusts: These trusts are created by another person for a beneficiary. Generally, these trusts are funded through life insurance, and they may begin either during a lifetime or at the time of death. Additionally, family members may contribute gifts toward these trusts.
- First-Party Special Needs Trusts: These trusts can only be created by a parent, grandparent, or legal guardian, and may only be funded by the beneficiary’s funds. For eligibility, the beneficiary has to be under the age of 65. Notably, these types of trusts are irrevocable. Generally, first-party special needs trusts are created when a beneficiary is to receive or inherit funds through a lawsuit or settlement.
- Pooled Special Needs Trusts: When it comes to this type of trust, several members will pool their assets into a larger investment fund. However, to qualify, a disability must be proven, and the trust must be developed through a nonprofit organization.
If you have any questions or concerns about creating a special needs trust in California, contact our firm today.
Contact our Firm
Working with an experienced estate planning attorney, such as Jaci Feldman of the Woodland Hills, California, Law Offices of Yacoba Ann Feldman, will ensure that you are taken care of when you need it most. Do not delay. Estate planning is a more urgent matter than you may think. You never know what the future holds. Contact The Law Offices of Yacoba Ann Feldman to schedule a consultation today.