How to Create a Will for a Special Needs Individual
Parents of children with special needs carry a deep concern of ensuring their child is presently cared for after they are gone, and this overwhelming thought can create sleepless nights filled with worry. Planning allows a child to be cared for while providing peace of mind. There are avenues to ensure the needed support, but taking those steps ahead of time is critical.
Colorado Special Needs Trusts
Being proactive requires individuals to set aside funds to provide for an individual’s needs without limiting any assistance they receive, and the process can be challenging. State and federal governments permit the creation of a Colorado special needs trust, allowing a family to provide financial assistance without endangering government benefits. The laws require that an individual receiving Medicaid or Supplemental Security Income (SSI) to have assets and income remain below a set level.
A family member or guardian can establish a trust for the individual using the personal funds the special needs individual may already have. There may be a savings account, an inheritance, or funds that were received as compensation for a personal injury.
Funds for a third-party trust are given by someone else. Family members such as parents or grandparents can include the trust in their will or trust, with some trusts providing an avenue to avoid probate. It is also possible for these funds to go into a stand-alone trust, which allows the funds to become available immediately to care for the needs of the individual without waiting until the death of the trust’s creator.
Establishing the Special Needs Trust
Parents or guardians know how much money a special needs individual will need to live, and determining this will facilitate decisions on what assets or money should be placed into the trust and how it should be managed. Overseeing this trust will be a trustee, responsible for its management and ensuring that the best interests of the special needs individual are looked after. Instead of choosing a single individual, two people or a team can be selected to ensure the proper administration of the trust or to always provide for a trustee if the original trustee cannot perform their duties or passes away.
Clear documents must be drafted and put into place before the final signing, and working with a knowledgeable Colorado special needs trust and estate attorney is essential. After transferring assets or establishing or updating a will, scheduling regular meetings to review the documents and ensure a trustee manages the funds as directed and meets the beneficiary’s needs is essential.
Taxes and fees must be considered when establishing a Colorado special needs trust. Management fees paid to the trustee may be owed, and exploring the best options for minimizing taxes is a priority. So, having a trusted Colorado estate planning attorney is imperative.
What Trust Funds Can Provide For
Trust funds are meant to be supplemental incomes adding to the benefits already received. Trust funds cannot be used to provide the needs that governmental programs supply but may be used for the following:
- Educational costs
- Non-covered medical expenses such as dentistry and specific therapies
- Transportation costs
- Vacations and leisure activities
The trustee must make these purchases for the individual and cannot directly make cash payments. Additionally, beneficiaries are required to allow a trustee to manage and distribute the money as they see fit without their input.
Colorado Special Needs Trust and Estate Attorney
Challenging decisions must be made when creating a special needs trust. Not only is managing the funds appropriately a concern but caring for the needs of a loved one is vital after a parent or caregiver is gone. Colorado Estate Planning Law Center offers the care and experience you need and provides a free initial consultation to compassionately prepare for ensuring a special needs individual’s necessities are met.