What is a special needs trust?

A special needs trust is a type of trust that is used to provide financial support for people with special needs without disqualifying them from certain government benefits, such as Social Security. It is set up by a family member, guardian, or court to help take care of the physical, emotional, and financial needs of an individual with a disability. The trust is created by placing assets, which can include cash, stocks, and real estate, into the trust. The trust is managed by a trustee, chosen by the family or court, who is responsible for making sure the trust is used appropriately for the benefit of the person with special needs. The trustee has a duty to put the beneficiary’s interests first and make sure that all the funds are being used in a legally appropriate manner. In Virginia, the creation of a special needs trust is subject to specific rules that must be followed. This includes appointing an attorney to draft the trust agreement, obtaining court approval of the trust agreement, and obtaining a transfer from the Social Security Administration that assigns the trust resources specifically for the benefit of the person with special needs. The primary benefit of a special needs trust is that it allows people with disabilities to remain eligible for government benefits without endangering their ability to qualify for those benefits. The trust is managed by a trustee who is knowledgeable of the applicable rules and regulations. For the people with special needs, special needs trusts can be a powerful way to ensure that their financial needs are met while still allowing them to qualify for government benefits.

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What is a special needs trust?

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