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WHAT IS A SELF-SETTLED SPECIAL NEEDS TRUST?

Posted by: Begley Law Group

by Thomas D. Begley, Jr., CELA Trusts for disabled individuals who have not reached age 65 and are funded with assets of the disabled person are authorized under OBRA-93.[1] The trust is for the benefit of disabled persons. The person must be under 65 at the inception of the trust. While the trust must be established and funded prior to the beneficiary attaining the age of 65, it may continue after 65. If the trust is funded with a structured settlement prior to the beneficiary attaining the age of 65, the trust remains viable even though payments from the annuity […]

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WHAT IS A THIRD PARTY SPECIAL NEEDS TRUST?

Posted by: Begley Law Group

by Thomas D. Begley, Jr., CELA A Third Party Special Needs Trust is usually used in a Medicaid context not for the benefit of the grantor of the trust, but for the beneficiary. The grantor of the trust is typically a parent, but could be grandparent, sibling, other relative or friend. The grantor uses the grantor’s assets to fund the trust. The assets of the beneficiary cannot be used to fund a Third Party Special Needs Trust. In order for the trust to be a Special Needs Trust, the beneficiary must be disabled. Disability is usually determined by the fact […]

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Filed under Estate and Trust Administration, Estate Planning, Special Needs Trusts.
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USING SELF-SETTLED SPECIAL NEEDS TRUSTS TO PROTECT PUBLIC BENEFITS

Posted by: Begley Law Group

Many public benefits available to persons with disabilities, such as Supplemental Security Income (SSI) and Medicaid, place limits on income and certain types of assets. Exceeding such limits can lead individuals to lose some or all of their benefits. Individuals receiving SSI are limited to $2,000 of assets. For many individuals, their Medicaid is linked to their SSI. Today there are many Medicaid Waiver Programs. In many states the asset limit for these waiver programs is also $2,000, but this varies from program-to-program and from state-to-state. Assets held in ABLE accounts do not affect SSI until the ABLE account reaches […]

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Filed under Blog Special Needs Planning, Estate Planning, Special Needs Planning, Special Needs Trusts.
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COMPARISON BETWEEN A DISABILITY ANNUITY TRUST AND A DISABILITY ANNUITY SPECIAL NEEDS TRUST

Posted by: Begley Law Group

by Thomas D. Begley, Jr., CELA The chart below is a brief comparison between a Disability Annuity Trust (“DAT”) and a Disability Annuity Special Needs Trust (“DASNT”). Consideration              DAT          DASNT Typical Grantor Parent/Grandparent Parent/Grandparent Typical Trustee Family Member (Non-Beneficiary) Family Member (Non-Beneficiary) Assets Available Yes No SSDI/ Medicare Yes Yes SSI/Medicaid No Yes Transfer Penalty No No HEMS Standard Yes No SNT Standard No Yes  

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Filed under Blog Special Needs Planning, Special Needs Planning, Special Needs Trusts.
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CONSIDERATIONS IN DRAFTING A DISABILITY ANNUITY SPECIAL NEEDS TRUST

Posted by: Begley Law Group

by Thomas D. Begley, Jr., CELA There are four main issues to be considered in drafting any trust involving a potential Medicaid recipient. These include: Availability; Transfer of asset penalty; Payback provision; and Tax considerations, including income, gift and estate taxes. Let’s examine each of these issues in the context of a DASNT. Availability. The assets in the DASNT would not be available, because the trust would be designed to give the trustee complete discretion with respect to distributions. Standard Third-Party Special Needs Trust language would be used in designing the trust. The standard DAT language would also be included. […]

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Filed under PISpecialNeeds, Special Needs Planning, Special Needs Planning, Special Needs Trusts, Special Needs Trusts.
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Medicaid Planning with Disability Annuity

Posted by: Begley Law Group

By Thomas D. Begley, Jr., CELA The Concept A sole benefit of trust is a creature of HCFA Transmittal 64.’ These trusts have traditionally been used in crisis planning. They can be established for the benefit of disabled persons—a Disability Annuity Trust (“DAT”).2 The idea is that assets would be transferred to an irrevocable trust for the sole benefit of the disabled individual. The assets in the trust were then paid out to the beneficiary on an actuarially sound basis using the actuarial tables contained in HCFA Transmittal 64.;i However, some states, including New Jersey, maintain that despite the clear language in HCFA Transmittal 64, the language in the statute “sole benefit […]

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Filed under Life Care Planning, Medicaid Planning, Medicaid Planning, Medicare, Special Needs Planning, Special Needs Trusts.

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DISABILITY ANNUITY SPECIAL NEEDS TRUST

Posted by: Begley Law Group

by Thomas D. Begley, Jr., CELA One of the trusts used in Medicaid Planning is a Disability Annuity Special Needs Trust (“DASNT”). A previous article discussed a Disability Annuity Trust (“DAT”). These trusts are designed so that an individual can establish a trust and transfer assets to the trust for the benefit of a disabled child of any age or a disabled individual under age 65 without incurring a Medicaid transfer of asset penalty. The problem with that trust is that the assets in the trust are considered available for public benefit purposes. Therefore, if a DAT were established for […]

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Filed under Special Needs Planning, Special Needs Trusts, Uncategorized.
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New Jersey and Pennsylvania Medicaid Planning, Medicaid Applications, Asset Protection, Special Needs Trust, Estate and Trust administration and Estate Planning.
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