The challenge of caring for a disabled or special needs family member can be rewarding, but also exhausting financially and emotionally. There are legal methods for helping caretakers through this difficult time and ways to support the disabled loved one in the future.
Tools for Long-Term Support
Disability trusts are created for the purpose of caring for a disabled person in the event of their caretaker’s death.
Support trusts are designed to take care of basic needs. This type of trust requires the trustee to make distributions for necessities like food, shelter, clothing, medical care, and educational services. The “level of support” required is generally interpreted as the level to which the beneficiary is accustomed to.
In these cases, the trustee is the party who oversees the distribution of assets and funds. Trustees can be financial institutions, relatives, or neutral third parties. But whoever they are, they have a great deal of responsibility.
The support trust is an estate planning tool commonly used by parents who want to take care of their children after they pass away or become unable to care for their child.
One of the greatest benefits of the support trust is that the assets in the care of the trust cannot be taken by creditors. Even if the grantor of the trust owed money to someone else, the creditor cannot come after the assets in the trust. This ensures that the beneficiary will be taken care of in the future.
What Is Included
Both the Disability and Support Trusts are created to pay for essentials. In fact, if a beneficiary wants money for something that is considered a “luxury,” they may have to submit a request to the trustee to be reviewed and approved.
Beneficiaries of support trusts are not eligible to receive financial assistance through Supplemental Security Income (SSI) or Medicaid. If your child will require SSI or Medicaid, you should avoid a support trust.
Setting up either a Disability or Support Trust is a convoluted process with an overwhelming amount of legal documents and filings.
If you are considering setting up a trust to care for your child in the future, contact us today to schedule a free consultation at 210-985-2741. Our San Antonio law firm has over 35 years of experience and we will work to preserve your family’s wealth for generations to follow.