Creating Special Needs Trusts
This playbook outlines the steps to set up a Special Needs Trust, which is a plan designed to financially support an individual with disabilities while preserving their access to government benefits.
Step 1: Assessment
Assess the needs of the beneficiary with disabilities to determine the appropriate type of Special Needs Trust and the level of funding required.
Step 2: Legal Counsel
Consult with an attorney who specializes in Special Needs Trusts to ensure legal compliance and to receive guidance on structuring the trust.
Step 3: Choose Trustee
Select a reliable trustee who will manage the trust. This can be a family member, friend, or a professional trustee.
Step 4: Draft Trust Document
Work with your attorney to draft the Special Needs Trust document, outlining the terms, funding, and the beneficiary’s needs.
Step 5: Sign Documents
Have all relevant parties, including the grantor and trustee, sign the finalized trust document in the presence of a notary public.
Step 6: Fund Trust
Transfer assets into the trust account to fund it. This could include cash, stocks, real estate, or other valuable assets.
Step 7: Maintain Records
Keep detailed records of all trust transactions and statements, ensuring full transparency and accountability for the trust’s operation.
Step 8: Notify Agencies
Inform all relevant government agencies of the existence of the trust to maintain the beneficiary's eligibility for assistance programs.
General Notes
Tax Considerations
Consult a tax professional to understand the tax implications of establishing and funding a Special Needs Trust.