What is a special needs trust and how does it work?

A special needs trust is a legal arrangement set up to provide financial assistance to a person with special needs or a disability, while still allowing them to be eligible for public assistance programs. In California, a special needs trust is designed to ensure that money is available to pay for things that Medicaid and other public assistance programs do not cover, such as medical expenses, housing, furniture, and family activities. A special needs trust is set up with funds or property from someone who wants to help the beneficiary, such as a family member or friend. The trust is managed by a trustee who is responsible for investing and managing the funds to cover expenses for the beneficiary. All disbursements must be approved by the trustee to ensure that the funds are used for the benefit of the beneficiary, and these funds are not considered part of the beneficiary’s personal assets, so they are not subject to taxation. The trust funds can also be used to pay for legal representation or equipment not covered by public programs. Additionally, if the beneficiary does not use all of the trust funds during their lifetime, the remaining funds may pass to other beneficiaries, such as family members or friends. In California, setting up a special needs trust requires the help of an experienced estate planning attorney. The attorney will help to make sure that the trust is properly established and managed, and that all of the legal requirements are met.

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What is a special needs trust and how does it work?

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