Pasadena Special Needs Planning Lawyers Assisting Clients Looking to Safeguard the Future of a Loved One

Do I Need to Make Particular Arrangements to Leave an Inheritance to a Loved One with Special Needs?

As a result of their inability to join or rejoin the labour, many people with special needs depend on SSI (Supplemental Security Income) or Medi-Cal to meet their basic necessities. This implies that a person with special needs must meet tight income requirements to qualify for such benefits.

A special needs person’s ability to continue receiving government assistance may be impacted if they unexpectedly receive a sizeable bequest or financial gift from a friend or close family since the additional assets might put them over the qualifying barrier. Programs like SSI are based on need, and the government has imposed tight asset restrictions on who is eligible to receive benefit payments. It is typical for families to desire to offer more financial resources for their loved one, but this must be done cautiously so that their dependant does not lose access to benefits because government benefits only cover the bare essentials for a person with special needs. Establishing a special needs trust is a common approach.

How Do Trusts for Exceptional Needs Operate?

A special needs trust enables you to preserve a loved one’s standard of living while preserving their eligibility for government assistance. The trust’s assets are not considered, and the funds should be utilised to pay for living expenditures outside housing and food. Moreover, it provides you more control over who will inherit the trust once the beneficiary passes away and can shield assets from creditors.

A trustee (someone overseeing the trust) and a beneficiary are two people you should identify when creating a special needs trust (the person receiving assistance). Special needs trusts are frequently irreversible, meaning any assets given into the trust will become the trust’s property.

Considering that the trust’s objective is to give the beneficiary the financial means to live a pleasant life, you can finance the trust with a wide range of assets. First-Party Trusts (funded by assets belonging to the trust recipient) and Third-Party Trusts are the two most popular forms of special needs trusts (supported by third-party assets such as a parent).

Does a Special Needs Trust Prevent Medi-Cal Estate Recovery from Assets?

It is now simpler for Medi-Cal beneficiaries to shield their assets from Medi-Cal estate recovery after passing away because of recent law changes. The California Department of Healthcare Services may attempt to recover Medi-Cal benefits obtained during the beneficiary’s lifetime from the beneficiary’s estate, which often entails a hefty fee.

Thankfully, Medi-Cal may often only seize property in a probate estate. As a result, Medi-Cal is unlikely to access any assets held in a living trust, including a special needs trust. It is always better to speak with your lawyer because this generalisation has a few exceptions. Start early with your planning and ask your lawyer if a special needs trust is appropriate for your family if you think your loved one may be susceptible to Medi-Cal estate recovery.

How Can an Attorney for Special Needs Planning Help?

It may be daunting and complicated to navigate the laws and regulations governing things like Medi-Cal estate recovery and benefit eligibility for people with disabilities or special needs. At Barilari & Williams, LLC, we assist our clients in taking the necessary actions to safeguard the future of their special needs family members. To learn how we may help you, call our Pasadena office at 888-EST-PLAN.