What is a special needs trust?

A special needs trust is a trust for an individual who cannot or should not handle his or her own finances. These individuals typically are incapacitated, mentally or emotionally. Sometimes the person is mentally ill. Other times the person has been developmentally disabled since birth.

Types of beneficiaries:

  • Anyone at risk for financial abuse
  • Traumatic Brain Injuries
  • Developmentally Impaired
  • Substance Addiction
  • Minor cases settled in Mediation or Civil Court without probate requirement

The trust is not counted as a resource for public assistance purposes, in particular Medi-Cal and Supplemental Security Insurance (SSI), which are needs-based government benefits programs.

The trust is set up for the life of the beneficiary and gives the trustee absolute discretion whether or not to distribute any amount to the beneficiary. The beneficiary then has no right to any distribution.

Therefore, naming the trustee is extremely important. It should be someone who will distribute to the beneficiary what he or she needs, not what he or she wants. That is why it is called a special needs trust.

When we prepare a living trust for you, we can include a special needs trust provision tailored to your beneficiary's needs, at no additional cost.

However, we offer special needs trusts for individuals who need them set up immediately at a reasonable cost.