Establishing and Funding a Special Needs Trust

You can draft a special needs trust as a standalone document or make it part of your Last Will and Testament. Any relative, parent, friend or guardian may fund a special needs trust. It may also be funded with the assets from the beneficiary, which could include you.

Here are the conditions that must be met:

  • The beneficiary must be “disabled” within the meaning of the Social Security Act. That means they must be unable to engage in any substantial gainful activity as a result of his or her disability.
  • The beneficiary must be under age 65 when the special needs trust is established and funded.
  • If the special needs trust is self-funded from the beneficiary’s own assets, federal law requires that the special needs trust must provide for the reimbursement of Medicaid (or other governmental medical providers) at the death of the beneficiary. This is can be up to the full amount of medical benefits previously paid on behalf of the beneficiary.  

The establishment and administration of a special needs trust can be complicated, requiring coordination between federal and state agencies. Northwest advisors are experts at establishing and administering your trust from start to finish.

As your trustee, Northwest will provide investment advice, tax reporting and necessary fiduciary bookkeeping.

Contact Northwest Trust Services today for a free consultation for creating special needs trust.