How can I protect the assets of my disabled family member?
In Texas, disability planning law provides several options for protecting the assets of a disabled family member. The simplest option is to create a special needs trust (SNT). This type of trust can hold assets for the benefit of a disabled person, without endangering their eligibility for government benefits such as Social Security or Medicaid. An SNT must be created and managed by a third-party trustee, who will manage the assets in the trust in order to ensure they are used only for the benefit of the disabled person. Another option is to establish an ABLE account. An ABLE account is similar to a 529 college savings account and allows a disabled person to save money for disability-related expenses without losing eligibility for government benefits. The account must be set up and managed by a family member or guardian. It’s also possible to assign a power of attorney. This is a document that gives someone else the power to make financial decisions on behalf of the disabled person. The person given the power of attorney must be someone the disabled person trusts, and the power of attorney can only be used for the benefit of the disabled person. Finally, it’s important to ensure that any estate planning documents the disabled person already has are up to date and in order. This will ensure that the disabled person’s assets are distributed according to their wishes, and make it easier for those managing the disabled person’s finances to do so.
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