Can a Special Needs Trust
buy a house?
Yes. A Special Needs Trust can buy a house
and there are often good reasons to do so.
However, there are some strict rules under SSI law and under New Jersey
Medicaid regulations that must be considered before making that decision.
Can a Special Needs Trust
buy an automobile or van?
Yes. A Special Needs Trust can buy an
automobile or a van but insurance is often difficult to arrange. It is usually better for the trust to
lease the motor vehicle.
Can a Trust pay for
vacations?
Yes.
A Special Needs Trust can pay for vacations.
Can a Special Needs Trust
pay parents for the care of a child?
In New Jersey it is very
difficult for a Special Needs Trust to pay parents for the care of a child under
age 18. This is because the assets
of a Special Needs Trust under New Jersey Medicaid regulations cannot be used to
discharge a parental obligation of support.
Who gets the assets left in
the Special Needs Trust on the death of the beneficiary?
Under Federal law, the State
Medicaid Agency must be paid back for any benefits paid to the beneficiary of
the Special Needs Trust. If there
are assets remaining after repayment to Medicaid, they go to those beneficiaries
named in the trust document.
Does a person on SSD need a
Special Needs Trust?
SSD carries with it Medicare. Neither SSD nor Medicare is means
tested. However, there are often other reasons why a person on SSD might need a
Special Needs Trust. For example,
if there is a chance that person may eventually reside in group home paid for by
Medicaid, a Special Needs Trust should be considered.
Can a Special Needs Trust
distribute cash to the beneficiary?
Any cash distributed by a
Special Needs Trust to a
beneficiary will reduce the SSI payment dollar for dollar. If the SSI payment is completely
eliminated, Medicaid will be lost.
It is not good practice for a trustee of a Special Needs Trust to distribute
cash.
How are d(4)a Trusts taxed?
There are income, gift and
estate tax considerations in establishing and administering a Special Needs
Trust. These must all be carefully
considered.
Who is a good choice for
trustee?
It is best not to have a
family member as a sole trustee of a Special Needs Trust.
The combination of a family member and a
professional trustee is often a good arrangement.
Who is a good choice for a
trust protector?
If the personal injury
attorney who represented the family is willing to serve as trust protector, this
is often a good choice because the family has confidence in that person. |
