Special needs trusts are an invaluable benefit for people with special needs and their families, since they allow for the ownership of assets without a loss of needed benefits. An unfairness in the law allowing the trusts has now been corrected.
Many people with special needs rely on government benefits for their day-to-day care. Without those benefits, they could not survive for long. However, having access to property and other assets can make one ineligible for many government benefits, which at one time meant that people with special needs had to be paupers and not own property.
To address that problem, special needs trusts were created.
A parent, grandparent, guardian or a court could create a trust for the person with special needs. If done properly, that would not make them ineligible for government benefits. However, people with special needs were not allowed to create the trusts for themselves. The law assumed that everyone with special needs lacked the mental capacity to create a trust.
This was the subject of a recent article in the Wills, Trusts & Estates Prof Blog titled "The Special Needs Trust Fairness Act Has Passed."
Both the House and the Senate voted to pass the Special Needs Fairness Act, which gives the ability for people with special needs to create their own trusts for themselves. On Dec. 13, 2016, President Obama signed this into law when he signed a larger piece of health care legislation.
Special needs trusts still need to be set up carefully, so people with special needs should seek a qualified Cincinnati attorney for assistance to set up their own.
Remember: “An ounce of prevention is worth a pound of cure.” When making your estate plans or when probating an estate or administering a trust, do not go it alone. Be sure to engage a Cincinnati estate planning attorney.
For more information about estate planning, probate or trust administration in Cincinnati (and throughout the rest of Southwest Ohio) and to review free resources regarding estate planning, probate or trust administration, visit my website. If you have questions regarding this article or a particular legal matter, feel free to contact me at 513-399-PLAN (7526).
Reference: Wills, Trusts & Estates Prof Blog (Dec. 7, 2016) "The Special Needs Trust Fairness Act Has Passed."