Trusts for Special Needs Children

Special Needs Trusts, also known as Supplemental Needs Trusts (SNTs) are trusts that allow disabled persons to inherit assets that will meet their supplemental needs while preserving their eligibility for government benefits. This alleviates a lot of worries for parents of special-needs children who are usually concerned about what will happen to their child if they are no longer there to care for them.

Most special-needs children receive government benefits such as SSI and Medicaid. While these provide a modest income and medical coverage, there are asset limits that must not be exceeded in or remain eligible. A disabled person receiving SSI is limited to $2,000 or less in resources, or they may lose their SSI as well as their Medicaid.

To allow parents of special-needs children to ensure their children will be well taken care of, the government established rules pertaining to assets to held in trust for a SSI and Medicaid recipient, contingent upon meeting certain parameters. The trust must be designed to supplement, not replace, government benefits. The trust’s funds cannot be disbursed directly to the disabled child, but to a designated third party to buy goods and services for the disabled child’s use.

An SNT can be used for expenditures such as out-of-pocket medical/dental costs, eyeglasses, transporation, insurance, essential dietary needs, annual checkups, rehabilitation, personal care attendant, recreation or hobby materials, or other qualified expenditures. Your estate planning attorney can assist you in setting up an SNT for a special needs child.

Colorado Criminal Defense Attorney Kevin Ellmann
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