What is a special needs trust?

A special needs trust is a type of trust that is used to provide financial support to individuals with special needs without losing access to government benefits. In the state of Texas, a special needs trust is a legal document that establishes a fund that is managed by an individual or organization that is responsible for the well-being of the beneficiary (the person the trust is set up for). The trust is set up to provide financial support to the beneficiary and pay for any items or services that the beneficiary needs that are not covered by their government benefits. In Texas, there are two main kinds of special needs trusts. The first is a First-Party Special Needs Trust, which is funded using assets of the individual with special needs. The assets can be funds from a personal injury lawsuit, gifts from family or friends, or an inheritance. This type of trust is used to provide an inheritance or additional resources to a person with special needs without jeopardizing their public benefits. The second type of special needs trust is a Third-Party Special Needs Trust, which is funded by someone other than the beneficiary. This trust is used to provide financial support to a beneficiary without compromising their access to government benefits. Funds set aside for the trust are often used for items such as medical care, housing, recreational activities, and other needs not covered by public benefits. Overall, special needs trusts are important tools for providing financial support for individuals with special needs while still protecting their access to public benefits. With the help of these trusts, families can make sure that their loved one with special needs is taken care of in the event of their death or incapacitation.

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