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Spiro J. Verras Blog

Thursday, March 28, 2019

Tampa Estate Planning Attorney

You may, like many others, have a family member or loved one that has special needs due to a physical or mental disability. You may also wish to leave him or her an inheritance or provide them with monetary assistant and want to make a provision for that during the estate planning process. The problem arises due to the fact that an inheritance may be counting as income for the purpose and may thus jeopardize any government benefits your loved one with special needs either currently receives or may receive in the future. This, however, is not an insurmountable obstacle. The problem can be avoided through the use of a special needs trust. Verras Law, P.A. can help you with these kinds of hurdles that may come up during the estate planning process. At Verras Law, we design a customized estate plan that is tailored to the unique needs of you and your family.

What is a Special Needs Trust?


A special needs trust is a trust with the very specific purpose of providing for the support of a loved one with special needs without risking his or her loss of government assistance. If you wish to create this kind of a trust, you will need to transfer money or other assets to the trust in order to “fund” the trust. The ownership rights to the assets must be transferred to the trust. The trust will then hold the assets for the benefit of the beneficiary. The beneficiary will not have any control over trust management or trust distributions. The beneficiary cannot have any power to revoke or amend the trust. The beneficiary cannot direct the trust assets for his or her own support and maintenance. This element is critical to the efficacy of the special needs trust. The main reason the trust will not be counted against the beneficiary during income calculations to determine government assistance eligibility is the fact that the beneficiary does not have any control over the money.

There are limits to what special needs trust distributions may be used for. You see, a special needs trust is intended to supplement the beneficiary’s government benefits. It is not and cannot be intended to replace them. Expenses covered by the special needs trust that should have been covered by government benefits will be considered income as in-kind support and maintenance (ISM). For instance, the Social Security Administration will count trust distributions that pay for food, housing, and utilities as income in the calculation of SSI and Medicaid eligibility. Additionally, cash payments made from the special needs trust directly to the beneficiary will result in a dollar-for-dollar reduction in SSI benefits. Depending on the amount of the distribution, the beneficiary may end up completely losing SSI and Medicaid eligibility.

Estate Planning Legal Counsel Working for You and Your Loved Ones


We want to provide for our loved ones with special needs. We do not, however, want a gift or inheritance to do more harm than good. We would not want to put our loved one at risk of losing government benefits because our help was misguided. You can still help those with special needs without putting them in front of this risk. That is why there are legal tools available such as the special needs trust. Many may not even be aware that this extremely beneficial estate planning tool exist. Contact Verras Law today to discuss all the estate planning options that are available to help preserve the best interests of you and your loved ones.

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| Phone: 727-493-2900
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