Leading Estate Planning Attorney Ashley Sharek Advises Parents On 3 Areas to Consider When Planning Special Needs Trusts – Warrendale, PA

Top Estate Planning & Probate Lawyer Ashley Sharek founder of Entrusted Legacy Law, in PA, reveals three key aspects for parents to consider before establishing a special needs trust for their child with disabilities. For more information please visit https://www.entrustedlegacy.law/

Warrendale, Pennsylvania, United States – December 31, 2023 —

Parents need to address three critical areas before setting up a special needs trust, disclosed Estate Planning Attorney Ashley Sharek.

For more information please visit https://www.entrustedlegacy.law/

In an interview this week, the Founder of Entrusted Legacy Law, in Warrendale, PA., said parents need to address: what the trust will be used for, how it will be funded, and who will administer it.

She said: “Setting up a special needs trust is complex, but it might be a family’s only option to ensure ongoing quality of life for their child with disabilities.”

Firstly, parents need to consider what the trust will be used for. Sharek said: “Special needs trusts allow a child to be eligible for government assistance while still receiving trust money. But receiving an outright inheritance for a special needs person can result in loss of government benefits like Medicaid and Supplemental Security Income (SSI).” 

Trust money could be allocated to areas not covered by the government, such as insurance, transportation, equipment, or further improving quality of life, or activities, including going to the movies, taking a vacation or buying a computer. 

There are two Special Needs Trusts, and the difference is the source of funding for the trust. In a “First-Party Trust,” the person who is the beneficiary of the trust has received a sum of money or an asset that is in such an amount that it may disqualify them from public benefits. 

The level for being disqualified from SSI is a little over $2,000. If someone gets a personal injury or medical malpractice settlement that could be as low as $15,000, they won’t receive their benefits. 

So, to preserve those, they have the right under the law to put those funds into a First-Party Special Needs Trust. It contains their assets. ”The government says you will not lose your benefits if you do that. But there’s a catch: the government states that when you die, the trust must say that the state Medicaid agency gets whatever’s left in that trust as repayment for all the funds it paid on the person’s behalf.”

If parents or grandparents want to gift to this person with a disability or leave an inheritance, they can set up a “Third-Party Trust.” The funds are coming from a third party. They don’t belong to the beneficiary but are used for that beneficiary’s benefit. 

In those cases, the government is not entitled to reimbursement because those funds never belong to the person with a disability.

She said that a trust must assert whether the money is first-party or third-party money. “You do not want to mix the two because the government is entitled to repayment for that first-party money, and relatives certainly don’t want the money they’ve given into a Third-Party Trust to be paid back to the government unnecessarily.”

Sharek said another tricky question is how parents plan to fund the trust, adding: “The earlier a trust is created, the easier it is to start putting money away to benefit your special needs child. If both parents are healthy, they could make the trust the beneficiary of any life insurance policy or retirement benefit.”

“Parents with special needs children could also consider asking extended family and friends to leave gifts and inheritances to the trust.” 

The question of who will manage the trust needs to be considered. She added, “While you’re alive, you can manage the trust, but who carries those responsibilities after you die? You need someone you can trust who will execute the trust the way you want and intend it to be. Many put their other children in charge, which can often lead to further complications.” 

Sharek advised considering a neutral third party, such as a professional trustee or a team of advisors, instead of family members, to manage the trust, depending on its size and complexity.

Source: http://RecommendedExperts.biz

Contact Info:
Name: Ashley Sharek
Email: Send Email
Organization: Entrusted Legacy Law
Address: 105 Maple Dr, Warrendale, PA 15086, United States
Phone: 412-776-6758
Website: https://www.entrustedlegacy.law/

Release ID: 89117353

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