Due to precautions related to COVID-19, we have expanded our options for remote consultations. Please contact our office to discuss whether a full phone consultation or video conference is appropriate for your situation.

GLK Law offices of Gerald L. Kane A Life Care Planning & Elder Law Firm

Contact Gerry Today

Helping You Protect Your Loved Ones And Your Legacy

Encino Trust Attorney Answers, “What Should a Special Needs Trust Pay For?”

Trustees of special needs trusts shoulder an incredible amount of responsibility. In addition to providing care for the individual with special needs, they must also make sure the assets in the trust are spent wisely and will not disqualify the person from any benefits they may be receiving.

One issue that often comes up is whether or not special needs trust funds can be spent on food or housing, which also includes utility expenses like heat, water, and electricity. While trust money can be spent on these things, it may reduce the amount the person with special needs receives in Supplemental Security Income benefits or affect Medicaid eligibility. Considered to be a type of income called in-kind support and maintenance (ISM), the specific amount of money spent on food and housing can reduce the Supplemental Security Income benefits up to $270. Please note that $270 is the current deduction amount and may change to account for inflation. The deduction amount is calculated as one-third of the federal portion of the Supplemental Security Income grant, which is currently $750, plus an additional $20.

It’s important to have a good understanding of the person’s finances, including the benefits received and money in the special needs trust, before making decisions on how to pay for these various expenses. For instance, if the person with special needs received less than $270 from Supplemental Security Income due to other forms of income, the ISM could cost them their Supplemental Security Income eligibility. Since Medi-Cal eligibility can also be affected, it’s extremely important to know if the person can be disqualified from Medi-Cal benefits, which could be disastrous.

An Encino lawyer experienced with special needs laws can help you determine the right strategy to manage the trust finances while keeping all benefits in place. The Encino special needs lawyer can even help determine when it makes more sense to use trust funds to pay for food and housing if the impact on benefits is negligible. As you know, making sure the person with special needs receives the best care and quality of life possible is of utmost importance, which is why it’s so important to have the best information available when making choices concerning their care, income, and benefits.

If you would like to get more information about special needs trusts, or if you’re the trustee of a special needs trust and you’d like more information on how the trust may be managed, please set up an appointment at our Encino estate and elder law office by calling (818) 905-6088.

Categories

findlaw-network