• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Unsworth LaPlante, PLLC

Vermont Estate Planning Attorneys

Vermont: (802) 879-7133

Attend A Free Workshop
  • Home
  • Our Firm
    • About Our Firm
    • Meet Our Team
    • What to Expect When Working with Us
  • Services
    • Estate Planning
    • Incapacity Planning
    • IRA & Retirement Planning
    • Legacy Planning
    • LGBTQ Estate Planning
    • Medicaid Planning & Elder Law
    • Pet Planning
    • Special Needs Planning
    • Trust Administration
    • Young Families Planning
  • Resources
    • Articles
    • Elder Law Reports
    • Elder Law Resources
      • Burlington
      • Montpelier
      • Rutland
      • St. Johnsbury
      • White River Junction
    • Estate And Gift Tax Figures
    • Free Estate Planning Worksheet
    • Frequently Asked Questions
      • Estate and Gift Tax
      • Estate Planning
      • FAQs for Families Without an Estate Plan
      • Incapacity Planning
      • IRA & Retirement Planning
      • Legacy Wealth Planning
      • LGBTQ Estate Planning
      • Medicaid
      • Pet Planning
      • Special Needs Planning
      • Trust Administration
      • Trusts
      • Wills
    • Is Your Estate Plan Outdated?
    • Medicaid Resources
      • Medicaid Analysis Worksheet
      • Medicaid Guide
      • Vermont Medicaid
    • Newsletters
    • Presentations
    • Reports
      • Advanced Estate Planning
      • Basic Estate Planning
      • Estate Planning for Niches
    • SECURE Act
    • Top Estate Planning Techniques
  • Webinars/Seminars
  • Reviews
    • Our Reviews
    • Review Us
  • BLOG
  • Contact
Home » Special Needs Planning and Estate Recovery

Special Needs Planning and Estate Recovery

January 30, 2019 by Stephen Unsworth

special needsThere are numerous ways to facilitate asset transfers, so you should definitely discuss your options with a licensed estate planning attorney. If you go it alone without any professional guidance, you could make mistakes that have unintended negative consequences. This can definitely enter the picture if you have someone with special needs on your inheritance list.

Medicaid and Supplemental Security Income

Medicaid is a need-based government health insurance program. Because it is intended for people with a significant level of financial need, there is a $2000 asset limit. This being stated, there are some things that don’t count, including a home, personal belongings, and household effects.

Clearly, people with disabilities are going to require costly medical attention throughout their lives. Health insurance is a must, and since many individuals with special needs cannot earn income, they have limited resources. As a result, they can qualify for Medicaid as a source of health care insurance.

Speaking of income, there is another program that provides a monthly monetary infusion for people with disabilities that have little or no earning power. It is called Supplemental Security Income (SSI). The amount that a benefit recipient receives is modest, but it certainly helps.

When someone has been approved for Medicaid coverage and Supplemental Security Income, the eligibility is not necessarily permanent. A significant financial windfall could trigger a forfeiture of benefit eligibility. As a result, you have to take pause if you want to leave inheritances to someone with special needs that is enrolled in these programs.

Supplemental Needs Trusts

There is an estate planning solution if you would like to provide support for a loved one that has a disability. We should point out the fact that you can implement this strategy if you want to  make a person with special needs more comfortable while you are still living.

You could establish a supplemental needs trust for the benefit of a person with special needs without impacting government benefit eligibility. These instruments are alternately referred to as special needs trusts. After you fund the trust, the trustee that is named in the trust declaration can use these assets to satisfy the supplemental needs of the beneficiary.

The trustee would be able to pay for a wide range of different goods and services without impacting government benefit eligibility. Everything from vacations to musical instruments to exercise equipment can be purchased by the trustee. However, it is important to note that the beneficiary can never directly access funds in the supplemental needs trust.

Now that we have set the stage, we can get to the point of this blog post. The Medicaid program is required to seek reimbursement from the estates of people that are enrolled during their lives. If you establish a special needs trust for the benefit of someone else with your money, it would be looked upon as a third-party special needs trust.

In a legal sense, the assets belong to the trust; they are not part of the estate of a deceased person that was enrolled in the Medicaid program. As a result, these assets would be out of reach during the estate recovery efforts. A successor beneficiary that you name in the trust declaration would assume ownership of the remainder.

A person with a disability that is enrolled in these programs may come into money for some reason. It could be a personal injury settlement or an inheritance that was bequeathed by someone that did not understand the impact it could have on benefit eligibility.

Under these circumstances, a supplemental needs trust could be established with these funds. This would be a first party or self-settled special needs trust. If there is a remainder in the trust after the death of the grantor/beneficiary, the Medicaid program would be able to attach assets that remain in the trust.

Download Our Free Worksheet!

In addition to all of the great information that we pass along on this blog on a consistent basis, there are other resources that you can tap into on this website. One of them is our estate planning worksheet. This tool has been carefully prepared by our attorneys, and you can obtain a great deal of useful insight if you take the time to go through it. We are offering the worksheet on a complimentary basis, you can click the following link to access your copy: Free Estate Planning Worksheet.

 

  • Author
  • Recent Posts
Stephen Unsworth
Stephen Unsworth
Stephen A. Unsworth is admitted to practice in both Vermont and Maine, and has more than 30 years of experience in estate planning and business law. His mission is to provide quality estate planning services, including assistance with Living Trusts, Wills, Medicaid Planning, Probate, Trust Administration, Powers of Attorney, Special Needs Planning, and Family Limited Partnerships.
Stephen Unsworth
Latest posts by Stephen Unsworth (see all)
  • What Are the Duties and Responsibilities of an Executor? - August 11, 2022
  • Is a Trustee Paid? - August 2, 2022
  • What Happens If I Die Without a Will in Vermont? - July 26, 2022

Filed Under: Uncategorized Tagged With: Special Needs Planning, Medicaid estate recovery

Other Articles You May Find Useful

Essex Junction Medicaid planning attorneys
Last-Minute Medicaid Planning – Can It Still Help Me?
Essex Junction estate planning attorney
What Are the Duties and Responsibilities of an Executor?
Essex Junction trust attorney
Steps in Creating a Trust
Essex Junction elder law attorneys
How to Spot Signs of Elder Abuse
Essex Junction trust attorneys
Is a Trustee Paid?
How Do I Trust Thee…Part III

Primary Sidebar

Elder Law and Medicaid Planning Attorneys

Unsworth LaPlante, PLC

DOWNLOAD OUR FREE ESTATE PLANNING WORKSHEET

There's a lot that goes into setting up a comprehensive estate plan, but with our FREE worksheet, you'll be one step closer to getting yourself and your family on the path to a secure and happy future.
  • This field is for validation purposes and should be left unchanged.

Follow Us

  • Facebook
  • LinkedIn
  • Twitter
  • YouTube

Blog Subscription

  • This field is for validation purposes and should be left unchanged.

Essex Junction, VT

26 Railroad Ave
Essex Junction, VT 05452
United States (US)
Phone: (802) 879-7133
Fax: (802) 879-0408

Map

unsworth_sidbr_map

Office Hours

Monday8:00 AM - 4:00 PM
Tuesday8:00 AM - 4:00 PM
Wednesday8:00 AM - 4:00 PM
Thursday8:00 AM - 4:00 PM

Footer

footer-logo
  • Facebook
  • LinkedIn
  • Twitter
  • YouTube

The information on this Vermont Attorneys & Lawyers / Law Firm website is for general information purposes only. Nothing on this or associated pages, documents, comments, answers, emails, or other communications should be taken as legal advice for any individual case or situation. This information on this website is not intended to create, and receipt or viewing of this information does not constitute, an attorney-client relationship.

American Academy of Estate Planning Attorneys, Inc. Privacy Policy | Contact Us | Disclaimer | Site Map | Powered by American Academy of Estate Planning Attorneys

© 2022 American Academy of Estate Planning Attorneys, Inc.