The Special Needs Trust Fairness Act allows people with disabilities who have capacity to act on their own behalf the opportunity to create their own special needs trusts. Formerly, these types of trusts could only be established by parents, grandparents or legal guardians of those with special needs. For those who do not have parents or family members, this act makes it easier from a legal standpoint to accomplish this task.
The Special Needs Trust Act is a provision included in a larger act, 21st Century Cures Act which addresses making resources available for cancer research, Alzheimer’s cures and medications and bringing much needed reform to the issue of mental health and drug addiction.
A special needs trust is a specialized trust allowing those with disabilities to own assets and receive income while preventing them from missing out on government aid. Government aid is based on very specific requirements. Special needs trusts allow individuals with disabilities to receive and accumulate assets without jeopardizing eligibility for government programs, such as Supplemental Security Income (SSI), Medicaid, and vocational rehabilitation. To qualify, someone with special needs has to prove their condition and that their assets and income are low enough to qualify.
For example, if someone with special needs were to receive an outright inheritance from a family member, that could disqualify the person from valuable government aid. Setting up a special needs trust allows the person to benefit both from the funds in the trust while continuing to receive the government assistance. The trust is carefully structured and the trustee must abide by certain rules regarding income distribution.
For more information on setting up a special needs trust either for yourself as allowed by the Special Needs Trust Fairness Act or for a loved one, please contact Stouffer Legal at 443-470-3599 in the Greater Baltimore area.