A special needs trust can preserve benefits

A special needs trust can be established for a California resident who receives benefits through any government programs. A trust protects the beneficiary, permitting them to receive benefits and funding from the donor.

Every trust consists of a donor, trust and trustee. While the trustee holds the trust and distributes the funding in accordance with the donor's wishes, the donor submits the funding to the trust. The beneficiary is the recipient of the funding.

Trusts ensure that property is administered as desired. The approach to managing a donor's assets is a sound strategy and attractive option that's affordable. The donor's wishes are outlined in a document in the form of instructions.

Supplemental Security Income regulations play a significant role in why the various trust models exist. A person with more than $2,000 in assets can have their funding transferred to a trust in order to collect government benefits. There are three variations of special needs trusts available. One can establish either a first-party trust, pooled trust or a third-party trust. The first-party version holds the assets of the individual with special needs. A pooled trust holds funds from multiple beneficiaries who have special needs. A third-party special needs trust holds the funds of multiple people who want to help the person with special needs.

While the beneficiary is alive, they can utilize the benefits. The government is reimbursed by the leftover funding in the special needs trust when the beneficiary passes. An experienced lawyer can assist with identifying the appropriate trust for the estate owner and beneficiary.

Related Posts: Estate planning for chronic illness, Using a trust, BIG NEWS ON TRUST TAXATION, When trusts are better than wills

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