Creating special needs trust is a powerful tool. Many children with special needs are eligible for supplemental security income (SSI), Medicaid, and even subsidized housing. All of these programs are excellent resources for your special needs child to utilize.
A special needs trust allows you to hand down your assets without making someone ineligible for the benefits that they rely on. However, there are people with special needs who may not qualify for SSI or Medicaid. But due to their disabilities, they are not fully capable of taking care of themselves. In such cases, it’s important to work with a skilled New Jersey special needs trust attorney who can help you create a trust that addresses the unique needs of your loved one. At Matus Law Group, our team may be able to help you overcome the challenges of raising a special needs child.
Discretionary Trusts Explained
With a discretionary trust, the trustee has the freedom to manage the trust at their own discretion, including selecting beneficiaries and determining when to release funds. While the trustee may use their judgment to choose beneficiaries, they must still follow the settlor’s wishes in managing the trust.
In addition to this, a discretionary trust can safeguard family assets from being divided in divorce settlements. The trustee can modify the beneficiary selection and asset distribution as needed to shield the trust’s assets. Although a trust cannot be utilized to conceal assets from creditors, establishing one can offer protection for beneficiaries. Furthermore, a discretionary trust can assist young beneficiaries in managing their funds, as the trustee has the authority to control and safeguard the funds if the beneficiary is unable to do so.
An experienced New Jersey discretionary trust lawyer can help ensure that the trust is set up correctly and that the trustee follows the legal guidelines for managing the trust. At Matus Law Group, our team of skilled NJ discretionary support attorneys may be able to provide ongoing advice and assistance to ensure that the trust remains in compliance with the law and that the beneficiaries receive the maximum benefit from the trust over time. Call us at (732) 281 – 0060 to learn more.
Discretionary Support Trust
A discretionary support trust, for instance, still allows for a trustee to disperse supplemental income to your chosen beneficiaries. But this type of trust gives the trustee an additional level of flexibility in disseminating funds to your child.
It is important to note that a beneficiary’s access to money is either mandatory or discretionary for trusts. When a trust is mandatory, the beneficiary can request money from the trustee, and the trustee is required to issue those funds. With a discretionary trust, the trustee has the choice of whether to give the funds.
That is particularly important when it comes to some people who possess special needs. The trustee can continue to look out for their best interests. Choosing the right trustee to assist with your special needs child is of vital importance.
Benefits
Recall how a special needs trust could be used in conjunction with someone receiving benefits such as SSI or Medicaid. The trustee needs to be diligent because there are such things as countable resources. People who receive SSI must have $2000 or less of countable resources.
If the beneficiary (special needs child) has more than $2000 in their bank account (or in cash) or spends more than that on meals or property taxes, for example, they could no longer be eligible for SSI.
If the special needs child is not receiving SSI, the trustee is not beholden to that $2000 limit. This frees up the trustee to pay for rent, and mortgage, and even make investments that exceed $2000.
When you build your estate plan and utilize a discretionary trust, you can still identify which things the trustee has to pay for. For example, you could set a minimum allowance that your beneficiary can receive to support their living expenses.
Matus Law Group
The Matus Law Group was built around compassion and understanding for special needs families. We know how much you want your child to have a fulfilling life, and we can help you create an estate plan with that in mind. If you have any further questions or would like to speak to a professional estate planning attorney, contact The Matus Law Group.
