Special Needs Trusts (SNTs) provide for the day-to-day needs of a disabled individual that are not covered by Medicaid, while preserving the beneficiary’s ability to receive government benefits.
A first party SNT is funded with the assets of the beneficiary and is most often used when the disabled person inherits money or receives a court settlement.
A third party SNT is typically funded by the parents or grandparents of the beneficiary and may be included in a Last Will & Testament or created as a stand-alone trust.
With a third party SNT, the trust is not required to use any remaining trust assets to reimburse the state for Medicaid benefits received by the beneficiary.
With a first party SNT, the state Medicaid program gets first crack at all remaining Trust assets, even to the extent of exhausting all the remaining SNT assets.
Please feel free to schedule a no-cost consultation to discuss Special Needs Trusts or any other estate planning needs you may have.