Mullen and Iannarone, P.C.
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families of Suffolk County since 1972

Setting up a special needs trust

Some New Yorkers who are creating an estate plan may be concerned about how they will take care of a family member with disabilities. These disabilities may include genetic disorders, cerebral palsy, bipolar disorder or autism spectrum disorder, and they may be congenital or the result of an injury.

Many people who suffer from disabilities get government assistance, but it is necessary for a person to have assets under a certain amount to qualify. With a special needs trust, the assets do not belong to the beneficiary, so they are not counted toward the maximum and do not affect the person's access to benefits. Money in a special needs trust can support a person in a variety of ways including with daily care and education.

Usually, a special needs trust is either a first-party or third-party trust. The former means that the trust holds the beneficiary's assets. The latter means that the assets are given by someone else. It is important to choose a trustee who will not make errors in administering the trust because this could endanger access to benefits. Furthermore, if a person wants to leave assets to someone with a special needs trust, the assets should go to the trust and not to the individual.

An attorney may be able to explain other aspects of a special needs trust as well as various other ways that a person might care for a loved one with a disability. This may also be part of an overall plan of personal and asset protection for an elderly person. For example, it may be possible to place a person's home in a trust while allowing the person to continue living in that home so the home is not counted with other assets.

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