Special Needs Trust Attorney in Conyers, Georgia

If you or a loved one has a mental or physical condition that will require the assistance of public benefits, such as Medicaid and Supplemental Security Income (SSI), those programs place severe limits on the assets a person can hold. To qualify, you must have $2,000 or less in assets (with exemptions for a home and a car and some other necessities of life).

Fortunately, the government has allowed for the use of special needs trusts (SNTs) to provide for services not provided by the government without triggering a disqualification of benefits based on assets. The main provision is that these trusts – and their assets – must not be used to pay for anything that SSI or Medicaid pays for, generally, food, housing, and health care.

Special needs trusts must be specifically worded and managed so that the beneficiary – the disabled recipient – does not run afoul of government regulations for Medicaid and SSI.

If you’re in Conyers, Georgia, and you need to establish a special needs trust, contact me at Sharline S. Green, P.C. today. I have dedicated my practice to estate planning and will be happy to help you establish a special needs trust to care for you or a loved one as you or they receive needed government benefits.

I proudly serve clients in Conyers, Covington, Snellville, Lawrenceville, Greensboro, Atlanta, Oxford, Loganville, and Grayson, Georgia.

Why Special Needs Trust: What Do They Do?

As mentioned earlier, individuals receiving government benefits such as SSI and Medicaid are restricted in the assets they can control under their name.

This might not be a factor if the individual is a child living at home where the parents take care of the other necessities of life, but someone out on their own – perhaps after the death of the parents – might struggle to provide for themselves outside the basic food, housing and health care subsidies provided by the government.

Without a special needs trust, or SNT, the disabled individual may not be able to pay for goods and services not covered by government subsidies, including but not necessarily limited to:

• Dental, rehabilitative, and other health care services not provided by Medicaid

• Caregiving and personal assistance

• Housekeeping, cooking

• Computers, cell phones, television, appliances

• Grooming, dry cleaning, clothing

• Transportation costs

• Yard services, home security services

• Pet care

• Accountants’ and attorneys’ expenses

Types of Special Needs Trusts

There are three special needs trusts: first party, third party, and pooled.

A first-party, or self-settled, SNT must be established before the beneficiary – the disabled individual – turns 65 and must utilize their own money. Generally, the source of this money would be from an inheritance, an insurance settlement or court award, or even a lottery windfall. A self-settled SNA can also be used by someone who accumulates assets and then learns of an impending disability and sets up the SNT in advance.

As with all trusts, an independent trustee must manage all the assets in the trust, and the beneficiary can have no say in how the funds are distributed. A first-party trust must also be irrevocable – meaning it cannot be canceled or modified – and when the beneficiary dies, Medicaid will have exclusive claim to remaining funds to recover for its expenses.

A third party can be set up by anyone – family, friends, relatives, or charities. Any type of asset can be poured into a third-party trust: cash, property, jewelry, art collections, securities, investment instruments, etc. And anyone is free to contribute to it.

Again, the SNT must be managed by an independent trustee without input from the beneficiary, but it can be revocable – canceled or changed at any time. Unlike a first-party trust, the assets remaining after the beneficiary’s death can accrue to a “remainder beneficiary.” Medicaid will have no claim on remaining assets.

A pooled SNT is run by a nonprofit organization. The principal advantage is that the person or persons setting up the trust do not have to name a trustee, which can often be a difficult challenge. The nonprofit organization will have its in-house trustee handle everything. The assets funneled into the trust become part of a larger pool but remain earmarked for the named beneficiary.

A pooled trust must be irrevocable and set up before the beneficiary turns 65. Funds left over after the death of the beneficiary generally remain in the nonprofit’s pool of assets.

An ABLE Account as an Option

In 2014, the federal government passed the ABLE (Achieving a Better Life Experience) Act, allowing people with disabilities to save money for qualified disability expenses without violating the Medicaid and SSI asset limit of $2,000.

In 2017, Georgia joined Ohio, Kentucky, and Vermont in the STABLE Program, allowing the establishment of ABLE accounts in the state. ABLE accounts can be used to supplement SNTs or be established instead of a trust, but the disabled person must have become disabled before the age of 26 to qualify.

Georgia and its STABLE Program allow the accumulation of $235,000 in these accounts, the same amount as a 529 plan. However, once savings reach $100,000, SSI will be suspended while Medicaid will continue. Medicaid becomes the beneficiary of remaining funds in the account when the beneficiary dies.