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Suffolk County Special Needs Trust

The purpose of creating a will, trust, and other estate documents is to plan for the orderly distribution of your assets and to provide for those you care about. The manner in which you would go about this depends on a variety of factors, such as the size of your estate, the types of assets in your estate, who you want to benefit from your estate, and the specific needs of those beneficiaries. If you have a child or other loved one who has a disability, there are special concerns. While caring for them while you are still alive is one thing, making sure that they are properly cared for after your pass away or after you are unable to care for them present different challenges. One estate document that can help make sure that resources are available to provide for your disabled loved one’s needs is a special needs trust (SNT). To qualify as a special needs trust the trust must be set up with the clear intent that it is not to be used to diminish government benefits that the beneficiary is currently receiving or government benefits for which the beneficiary might otherwise qualify social as Social Security disability benefits or Medicaid. As a Suffolk County special needs trust lawyer at the Law Offices of Stephen Bilkis & Associates will explain, if the special needs trust is not set up or managed correctly, the beneficiary with special needs may lose critical government benefits.

Special needs trust

A trust is a legal arrangement set up by a trustor (creator, grantor, settlor) for the benefit of a beneficiary. The trustor transfers property into the trust that will be managed by a trustee. When the trust agreement is drafted it will include instructions regarding how the assets of the trust should be managed and distributed. A trust can be set up to serve a number of different estate planning goals including, including providing for someone with special needs.

In New York, special needs trusts are called supplemental trusts. Under New York Laws, Estates, Powers and Trusts Law § 7-1.12, special needs trust can be established for the benefit of a person with a severe and chronic or persistent disability. People with disabilities often qualify for government benefits based both on the severity of the disability and on financial need. Those with disabilities but who also have significant assets may not meet the financial requirements for certain benefits. Special needs trusts are designed to preserve beneficiaries’ assets and at the same time ensure that the beneficiaries remain eligible for government benefits. The assets that can be used to fund a SNT can come from a variety of sources including from family assets, a bequest in a will, a lawsuit settlement, earnings, or some other source. If the assets of a person with special needs are transferred into a special needs trust, then the funds can be used for the benefit of the beneficiary without those funds counting as a financial asset for benefit eligibility purposes. In order for a special needs trust to work, it is critical that it is set up properly. To ensure that your special needs trust is compliant, seek the counsel of a Suffolk County special needs trust lawyer.

Purposes for special needs trust assets

While the funds in a special needs trust are for the benefit of the disabled beneficiary, the funds cannot used for just anything for the beneficiary. The funds in a special needs trust can only be used for specific purposes related to the beneficiary's care, education, and therapy, as well as for products and services that will add to his (or her) quality of life.

  • Medical services. Medical treatment and care that is not covered by Medicaid, such as visits to the doctor, dental care, eye exams, massage, counseling, acupuncture, and hearing exams.
  • Medication and devices. In addition to medication, special needs trust funds can be used to pay for health and medical devices such as glasses, hearing aids, prosthetic devices, and expenses for maintenance of these devices.
  • Assistive technology. Special needs trust funds can be used to purchase or rent assistive technology such as computers, computer software, tablets, amplifiers, wheelchairs and other mobility devices.
  • Education. A special needs trust can provide funds for vocational training and educational expenses such as tuition, books, supplies, computer and software.
  • Fitness. Trust funds can be used for gym memberships as well as fitness equipment
  • Transportation. Funds from a SNT can be used to purchase of one vehicle car titled in the name of the beneficiary, or to modify a vehicle, as well as costs associated with maintaining it such as gas, oil changes, and other vehicle maintenance costs. Funds can also be used to pay for a taxi services, bus pass, and other public transportation costs
  • Home improvements. Funds from a special needs trust can be used to pay for home modifications such as ramps and rails to accommodate the beneficiary.
  • Non-food grocery items. This would include laundry detergent, fabric softener, deodorant, soap, personal hygiene products, paper towels, toilet paper, and similar items.

On the other hand, money from a SNT cannot be used to pay for everyday living items such as groceries, restaurant meals, mortgage or rent payments, property taxes and utilities. Paying such expenses from the trust may cause a financial penalty if the beneficiary is also receiving governmental benefits. In addition, even if the funds are used for eligible expenses, the cash should not be given to the beneficiary from the trust fund. Instead, the vendor should be paid directly. If you have questions about eligible expenses, it is best to seek the advice of an experienced Suffolk County special needs trust lawyer.

Selecting a trustee

A good special needs trust trustee is critical to a successful special needs estate plan. The trustee of a special needs trust typically has very broad discretionary powers and authority over the management of special needs trust funds. The trustee will be responsible for spending the money in the trust for the benefit of the beneficiary. It is important that the trustee is not only trustworthy, but that he or she also has the financial acumen and organization to prudently manage trust assets as well as an understanding of the rules and regulations related to special needs trusts. Typically trustees are parents, grandparents, siblings, other family members are close family friends. In some cases the trustee is a corporation or institution. However, using an institutional trustee may be quite expensive.

Here are some issues to consider when selecting the trustee for your special needs trust:

  • Is the person both willing and able to serve as trustee for an extended period of time?
  • Does the person already have a relationship with the beneficiary?
  • Will the person be responsive and attentive to the needs of the beneficiary?
  • Are there possible conflicts of interest?
  • Does the person have a strong financial background?
  • Is the person familiar with the rules related to Medicaid and SSI?
  • Is the person willing to learn the rules related to managing a special needs trust and reach out for help when necessary?
  • Can you afford the fees for professional management?
  • Is the person personally and financially stable?
  • How much can the trust afford to pay the trustee?

In addition to naming a trustee, consider the advantages of naming co-trustees, and consider naming a successor trustee or successor trustees.

Beneficiary eligibility requirements

Under New York law, to be a beneficiary of a special needs trust, the person must have a severe and chronic or persistent disability. The disability can be a mental illness, intellectual disability, developmental disability, alcoholism, substance dependence, or chemical dependence. While special needs trusts are often established by parents for children with disabilities such as autism and Down Syndrome, they can be set up for the benefit of anyone who has a special need and requires resources for their long-term care. You can set up a special needs trust for other relatives such as a sibling. Some spouses or children set up special needs trusts for a spouse or parent who has Alzheimer's disease, dementia, or other degenerative ailment or disability. For more information about special needs trust beneficiary eligibility requirements, contact an experienced special needs trust attorney in Suffolk County.

A special needs trust will remain in effect until one of the following conditions occur:

  • The beneficiary's condition improve such that he or she is no longer qualifies as being disabled.
  • The beneficiary passes away.
  • The assets in the SNT are used up.
Contact the Law Offices of Stephen Bilkis & Associates

If you would like to provide for a loved one with special needs, a special needs trust may be just one of several strategies in your estate plan necessary to provide for your loved one's needs. For example, in your will you can also specify who you want to be the guardian of your special needs child upon your death. To ensure that your special needs trust and other estate documents are properly drafted and executed, it is important for you to have experienced representation. One possible consequence of a poorly drafted special needs trust is that your loved one with special needs loses government benefits. The experienced special needs trust attorneys serving Suffolk County at the Law Offices of Stephen Bilkis & Associates will help you set up a legally compliant trust, and will help you develop an overall strategy to make you’re your disabled loved one has the resources he or she needs. Contact us at 1-800-NY-NY-LAW (1-800-696-9529) to schedule a free, no obligation consultation regarding your case. We represent clients in the following locations: Bronx, Staten Island, Nassau County, Brooklyn, Manhattan, Queens, Suffolk County, Long Island, and Westchester County.

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Mr. Bilkis handled both my father and mother's estate issues through very difficult times he was compassionate kind and understanding. In fact the whole firm showed great empathy. Despite the emotional hard time we were having that quickly and efficiently handle all the matters that were necessary to get us the result we desired. Can't recommend them enough. B.B.
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