Because of a disability there are children and adults who must rely on government benefits to live. Most of these programs will not provide benefits if the disabled person has assets in excess of $2,000. There are many things that government programs do not provide. Such things include cosmetic dental work like braces or travel to visit a parent, sibling or friend. With the $2,000 limit most disabled persons receiving those government benefits are unable to have those things (cosmetic dental work, travel to visit family, etc.). To meet those non essential needs, like cosmetic medical/dental care, travel and the like; the family and friends of a disabled person may consider putting money into a trust to provide those "special needs" not provided to the disabled persons by public assistance. To make sure that the trust does not disqualify the disabled person from the government benefits that covers most of life's basic needs it is important that:
1. The disabled person not have direct access to those funds. Therefore the disabled person should not be the trustee. The trust should not provide anything to the disabled person directly, but only provide those things that are not provided by government and other providers, and only at the discretion of the trustee.
2. It is essential that the trustee become knowledgeable as to what uses of the trust funds will not jeopardize the benefit eligibility of the disabled person; and in the management of the trust to be very careful in not causing periods of ineligibility. In Colorado there is a pooled fund that is very experienced in administering these trusts at a very reasonable cost. Therefore if a family member does not have the needed expertise, that family can utilize the pooled trust to provide their disabled person with the enriched life that may come from having assets available in addition to the government benefits to meet special needs.
Special Needs Trusts have the potential to enrich a disabled person's life. Let us help you make that happen.