As the adult population grows older, there is an increasing number of elderly Americans who require financial assistance. However, public benefit programs have certain income requirements that disqualify a significant portion of applicants. In these cases, a special needs trust may be used to help older disabled adults access public benefits and receive the care they need.
This article will discuss what a special needs trust is and how it can help elder beneficiaries. For any questions about special needs trusts or elder law, contact an experienced Texas estate planning attorney.
Limits on Government Assistance
Americans who suffer from certain disabilities and have limited resources can apply to receive benefits from the government. Medicaid, for example, helps cover medical costs. Supplemental Security Income (SSI) provides monthly benefits to disabled or older adults.
However, these programs are only available to people with limited financial means. The government places “means tests,” or resource limits, on who can receive these benefits. This means that people who have or make a certain amount of money are not eligible. For example:
- For example, to qualify for Medicaid, a single adult who is 65 or older can make no more than $2,829 per month. A couple applying for Medicaid has an income limit of $5,658.
- To be eligible for SSI, a single person cannot own more than $2,000 in countable assets, which are any real or personal properties that can be converted into cash.
- A couple who wants SSI benefits can have no more than $3,000 in countable assets.
Because these limits are low and prohibitive, some Americans use special needs trusts to help get around them.
What Is a Special Needs Trust?
When an asset is placed into a trust, the trust becomes its owner. The purpose of a special needs trust, therefore, is to transfer ownership of an asset from a person with special needs to the trust. In that way, the beneficiary now owns fewer assets and may be able to qualify for public benefits.
Another type of special needs trust is a third-party trust. In this trust, a third party, such as a family member, deposits assets for the beneficiary to use.
It is important to note, however, that special needs trusts are set up to pay for supplemental needs, not the needs you are already receiving assistance for. For example, you cannot use the funds in a special needs trust to pay for your living expenses if you are already receiving SSI benefits to pay for them.
Contact a Dallas, TX Special Needs Trust Attorney
Special needs trusts are a great way to help disabled elders who need assistance but remain outside the qualification bracket. Our aged population can access necessary medical care and cover living costs with the help of special needs trusts. At Andrew Dunlap Attorneys, PLLC, we use our experience and extensive knowledge of estate planning to create all types of trusts that will protect you and your assets. Call 972-807-6357 to speak with an excellent Dallas, TX special needs trust lawyer today.