Caring for an elderly loved one can be complicated for a variety of reasons. The person needing care may be a parent, which often leads to high emotions, complex feelings, and worries of their future. When income is an added complication, you may look into trusts to be able to provide for them in ways that their governmental benefits cannot. But how? There are nuances to creating trusts for the elderly that you must be aware of to ensure the benefits they receive are not impacted.
Special Needs Trust
Special needs trusts are those created for individuals with physical and/or mental disabilities and developed with the needs, lifestyle, and future of the beneficiary in mind. This includes age, external funding, and more.
Typically, trusts will last until the beneficiary’s death. Special needs trusts are used to ensure that government benefits are not lost by the beneficiary. When special needs planning first began, these types of trusts were called supplemental needs trusts, intended to supplement the assistance provided by Medicaid, Medicare, Social Security, Supplemental Security Income, and other public benefit programs whose level of support is often meager.
There are two forms of special needs trusts that are particularly beneficial to the elderly: trusts that fall under the Special Needs Trust Fairness Act and Public Benefits Planning.
Special Needs Trust Fairness Act
In December 2016, the government passed the Special Needs Trust Fairness Act which allows a person who is mentally capable but disabled, to establish his or her own first-party special needs trust.
First-party special needs trusts are most valuable when a person who previously did not have a disability and owns assets on their own, later becomes disabled and therefore needs to qualify for public benefits.
In essence, the law allows those individuals who qualify for public benefits to also have trusts to supplement their income.
Public Benefits Planning
Public benefits planning encompasses the long-term care and benefits elderly and disabled individuals may be planning for in their near future. Benefits including Medicaid, Supplemental Security Income, and veterans’ benefits can be a difficult undertaking alone, and one that causes great confusion regarding if and when you qualify.
Why Trusts Are Critical For the Elderly
“The U.S. Census Bureau estimates that more than 24 percent of Tennessee’s population will be 60 and older by the year 2030, an increase of almost 27 percent from 2012,” according to a study by the Administration for Community Living.
In 2014 alone, 92% of those ages 65 and over receiving it nationwide, and 94% of older Tennesseans receiving it. It’s no surprise that many of us have the same question–how can I maintain my benefits while receiving additional funds?
While keeping your elderly loved one independent and financially secure, you may not know where to begin the process of creating a special needs trust. The Tennessee estate planning attorneys of Martin Heller Potempa & Sheppard, PLLC are here for you.
Special Needs Trusts for the Elderly: Martin Heller Potempa & Sheppard, PLLC
If you are in need of a special needs trust for an elderly loved one, the Tennessee estate planning attorneys of Martin Heller Potempa & Sheppard, PLLC are here for you. Contact the Tennessee estate planning attorneys of Martin Heller Potempa & Sheppard, PLLC today.