Many parents or relatives who have children and family members with a disability are fearful about what will happen to their loved one after they pass away. Who will help take care of them? How will they be taken care of? Will they be safe?
There are specific planning strategies that will ensure your loved one is taken care of long after you’re gone. However, you must plan very carefully – otherwise you could jeopardize their ability to receive Supplemental Security Income (SSI) and Medicaid benefits. Certain assets, including cash in the bank, will disqualify your loved one from receiving benefits – you can’t just leave $5,000 in cash to your loved one. You need to set up a ‘Special Needs Trust’ in your Will.
What is a Special Needs Trust?
Instead of leaving your property to your loved one (giving them a check outright), you leave it to them in a Special Needs Trust (SNT). Your loved one will be the beneficiary of the Trust, but someone else will be in charge of managing it (the Trustee). This is an extremely important tool to avoid losing SSI or Medicaid benefits.
One of the most important choices when creating a SNT is who you name as Trustee. This person will have complete discretion over the assets in the Trust and will be in charge of spending money for the benefit of your loved one. Since your loved one will have no control over the money, SSI and Medicaid administrators will ignore the Trust’s asset for eligibility purposes.
Although the Trustee cannot simply take money out of the Trust and hand it to your loved one, they are allowed to buy a wide variety of goods and services for your loved one. For example, SNT funds are commonly used to pay for personal care attendants, vacations, home goods, out-of-pocket medical and dental expenses, education, vehicles, and physical rehabilitation.
Bender Law’s Approach
Bender Law’s managing attorney, Rachel Bender, not only has friends and family members with disabilities, but her first internship during law school was with Disability Rights Washington – a wonderful nonprofit organization in downtown Seattle. Rachel takes great pride is assisting individuals and families plan for the care of a loved one, and approaches this area of law with the utmost understanding and respect.