What is a personal injury trust?
A personal injury trust is a legal arrangement that can be used to protect the interests of a person with a disability. This type of trust, also known as a Special Needs Trust, is typically set up when an individual is awarded a personal injury settlement or judgement as compensation for an accident or injury. In Maryland, the personal injury trust must be established in accordance with Disability Planning Law. A personal injury trust preserves the assets of the disabled person, shielding them from being considered a resource for purposes of Medicaid eligibility determinations, and allowing them to use the settlement funds as they please. The trust allows the disabled beneficiary to receive income and other resources that would not otherwise be available, while still allowing them to qualify for government benefits. The trust can be used to pay for medical, educational, recreational and other extraordinary expenses not covered by Medicaid, such as wheelchairs, in-home care, and special education services. Additionally, a personal injury trust allows the disabled beneficiary to maintain their independence by paying for transportation and housing costs, as well as any necessary adjustments to their home or car. These trusts also provide a way for the beneficiary to stay in control of their assets. Trustees are appointed to manage the funds, and the beneficiary retains the power to make the financial decisions that best fit their individual needs. This trust also provides peace of mind for the beneficiary and their family, knowing that the funds are secure and available for their use.
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