Individuals with physical or mental limitations may have a limited ability to obtain employment or health insurance. As a result, these individuals often rely heavily upon government programs, such as Supplemental Security Income (SSI) or Medicaid. However, these programs are income-sensitive. A significant inheritance, gift, or personal injury lawsuit settlement can terminate their eligibility for such programs. That is why it is so important to consider special needs planning when establishing your estate plan.
* Special-Needs Inheritance Trust (also known as a third-party special-needs trust): This form of trust enables you to set aside funds or pass inheritance to a loved one with special needs. The funds are transferred directly into the trust for the benefit of the disabled individual.
* Special-Needs Trust/Medicaid-Payback Trust (also known as a first-party trust): This form of special-needs trust enables income from an insurance settlement, personal injury lawsuit, or other settlement to be placed directly into the trust. The disabled individual has the benefit of using the funds throughout life to enhance the quality of life and quality of care received. However, remaining assets in the trust are used to repay Medicaid when the individual passes away.
It is essential to draft special-needs trusts carefully. When improperly drafted, the trust could be found to be something other than a special-needs trust—resulting in ineligibility for government programs.
Our law firm believes that it is important for everyone to consider estate planning. However, it is especially critical when persons with special needs are involved. Failure to consider special-needs planning or failure to create an effective special-needs trust may result in the revocation of the government benefits they rely upon.
We clearly educate you on the benefits of special-needs trusts and how special-needs planning is important for your family. We help you establish a special-needs trust tailored to your family's specific needs. We carefully draft the language of the trust so that future Medicaid and other benefits are not jeopardized. You can have peace of mind that the inheritance left to your loved ones with special needs will enhance the quality of their life, not constrict their possibilities.
Contact special-needs planning attorney Robert ML Baker III by contacting our Santa Monica estate planning law firm today.
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The Santa Monica, California Law Offices of Robert ML Baker III represents clients throughout Los Angeles County, including the cities of West Hollywood, Westwood, Beverly Hills, Culver City, Malibu, Encino, Marina Del Rey, West Los Angeles (West LA), Santa Monica, Venice, Los Angeles, Sherman Oaks and the South Bay.
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