If you are a parent you likely spend time worrying about whether your children will be well taken care of once you’re gone.
You probably want to know that you’ve done what you can to ensure they are protected as children and that once they are old enough, they will be able to function independently and provide for themselves. You may want to consider a Minnesota special needs trust.
Parents of disabled children have added burdens and concerns, especially when those children will never be able to fully care for themselves. It’s this fear of not being able to provide for your children after you are gone that leads many parents to create a special estate plan taking into account their children with special needs.
One great way of ensuring that your disabled child will be taken care of later in life is to create a special needs trust. In almost all cases, a special needs trust is essential for a child, or an adult, who will depend on government assistance for much of his or her life. The sooner you create the trust and put the plan into action the more secure your child’s future will be.
What is a Minnesota Special Needs Trust?
A special needs trust (SNT) is a vehicle meant to ensure that the beneficiaries who are disabled or otherwise mentally or physically challenged can have access to and use of certain property that is held for their benefit. A SNT also works by simultaneously shielding the assets from creditors and the government. A SNT is critical because by shielding the assets, it also ensures that your child remains eligible for government programs which would otherwise require the depletion of that asset.
How to Create a Minnesota Special Needs Trust?
Special needs trusts are typically created for those individuals who lack the mental capacity to handle their own financial affairs. They can be especially helpful for people with mental or physical disabilities who would lose public benefits (such as Medicare or SSI) as a result of receiving a large sum of money, such as an inheritance or the proceeds from a lawsuit. Special needs trusts, when constructed properly, can help protect the disabled person from being taken advantage of and losing the money that is intended for their benefit.
The main value of a SNT is that it offers a way of holding assets for your child while, at the same time, preventing him or her from being disqualified for government assistance. Although your child is named as the beneficiary of the trust, the assets are not counted as his or her available resources because the assets are not within his or her control.
Why should I think about a Special Needs Trust in Minnesota?
It’s important to understand that a gift or inheritance that leaves your disabled child with non-exempt assets greater than $2,000 is basically a gift to the government, as it will disqualify your child from receiving benefits until the assets have been “spent down” to $2,000 or less. He or she may also not qualify for private health insurance, and could be left paying for his or her medical expenses out-of-pocket. Given the high cost of medical treatment, disqualification from Medicaid could cause your child’s inheritance to be exhausted in an astoundingly short amount of time. After that, your child will be completely dependent on other family members and meager governmental assistance, with no other money left for incidentals or living expenses.
A typical SNT exists to hold money or other assets that are used solely for the benefit of the special needs child, often providing spending money to pay for day-to-day expenses related to that person’s care or living expenses not covered by government programs. An SNT is useful in that it can ensure that your special needs child maintains a certain standard of living that they would not be able to afford if they existed solely on government assistance.
By turning to an experienced Minnesota estate planning attorney you can create a special needs trust that will serve your child for the rest of his or her life, anticipating future needs and ensuring they are well cared for even after you are gone.
Every child and every family has different needs and no two trust trusts are alike. If you have specific questions about creating a special needs trust or about estate planning generally, please contact Joseph M. Flanders of Flanders Law Firm at (612) 424-0398.
Source: “Administering a Special Needs Trust,” published at SpecialNeedsAlliance.org
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Thank you so much for taking the time out of your busy schedule to read this letter. I currently have a Wispact trust in the state of Wisconsin. I am probably going to have to move back to Minnesota as the person I am living with through the Wisconsin ILIFE/IRIS program is forcing me to take medications that are contrary to doctors orders through Advanced Pain Management,LLC. That is a short version of the story. My only proclivity is I have a fair amount of money in the account, but I want my sister in Minnesota to handle it should I move there. The people at Wispact are telling me a Minnesota attorney must handle this case and that is the reason I am contacting you. As this is just one of your strong suits and specialties. I have until the end of September to move. Therefore, if you could call me it would be deeply respected.