Special Needs Trusts (SNTs) are crucial tools for preserving the financial well-being of individuals with disabilities by allowing them to receive income without losing eligibility for government assistance such as Medicaid or Supplemental Security Income (SSI). However, individuals in Georgia often wonder whether it is possible to set up an SNT for themselves. This blog explores the nuances of self-settled Special Needs Trusts in Georgia, providing key insights and legal guidelines.
Key Takeaways:
- In Georgia, individuals can set up a special needs trust (SNT) for themselves to ensure financial security without jeopardizing eligibility for public assistance programs.
- Self-settled special needs trusts, also known as first-party special needs trusts, are designed to hold the beneficiary’s assets while maintaining their eligibility for benefits like Medicaid and SSI.
- Legal guidance is crucial when setting up an SNT to ensure compliance with both state and federal regulations.
Understanding Special Needs Trusts in Georgia:
A Special Needs Trust is designed to manage resources while maintaining an individual’s eligibility for public benefits. There are two main types of Special Needs Trusts: first-party and third-party trusts. The type that allows individuals to create the trust with their own funds is known as a first-party SNT, or more commonly, a self-settled SNT.
Self-Settled Special Needs Trusts:
In Georgia, self-settled SNTs are permitted under federal law. These trusts are funded with the beneficiary’s own assets and are designed to supplement, not replace, the benefits provided by government programs. They are particularly useful for individuals who have acquired assets before receiving a disability diagnosis or those who are coming into direct inheritance or settlement money.
Key Points for Setting Up a Self-Settled SNT in Georgia:
- Eligibility Criteria: The beneficiary must be under the age of 65 and meet the government’s definition of being disabled.
- Trust Structure: The trust must be established by a parent, grandparent, legal guardian, or by a court, even if the funds are the beneficiary’s.
- Payback Provision: Federal and state laws require that upon the death of the beneficiary, any funds remaining in the trust must first be used to reimburse the state for Medicaid benefits paid on behalf of the beneficiary.
Benefits of a Self-Settled SNT:
- Resource Management: Helps manage and protect financial resources without affecting eligibility for Medicaid or SSI.
- Flexibility: Funds in the trust can be used for a variety of life-enhancing expenditures without compromising public benefits, such as education, transportation, and personal care.
- Control and Independence: While structured for compliance with legal requirements, these trusts still provide a degree of financial autonomy and security.
Considerations Before Establishing a Self-Settled SNT in Georgia:
- Legal Assistance: Due to the complexities involved in setting up a compliant SNT, it is advisable to consult with an experienced estate planning attorney who understands Georgia-specific regulations and federal laws.
- Long-Term Planning: Consider how your needs may evolve over time and discuss these scenarios with your attorney to ensure the trust accommodates potential future changes.
Setting up a Special Needs Trust for yourself in Georgia is not only possible but also a prudent decision to safeguard your assets and future quality of life while maintaining eligibility for essential public benefits. With the right guidance and strategic planning, a self-settled SNT can provide financial security and peace of mind.
Get Help Today with Hurban Law, LLC in Lawrenceville, GA
If you or a loved one are considering a Special Needs Trust in Georgia, contact us at Hurban Law LLC. Our experienced estate planning attorneys can help you navigate the process, ensuring that your trust aligns with both your financial goals and legal requirements. Secure your future today with a personalized consultation.
