Fair Lawn Lawyer Helps Families Create Special Needs Trusts 

New Jersey firm develops means of lasting financial support for disabled individuals

If you have a disabled loved one, you might be very concerned about how their long-term financial needs will met. Failing to prepare could leave a family member in a difficult position after you are gone, especially if they are not eligible for government-provided benefits. At The Paton Law Firm LLC in Fair Lawn, I establish special needs trusts to help New Jersey families like yours, making sure that clients’ wishes are honored and costly mistakes are avoided. 

What is a special needs trust?

A special needs trust (SNT) is a trust created to provide financial assistance to a disabled person without jeopardizing their eligibility for government benefits. A first-person SNT uses the disabled person’s own assets, while a third-person SNT uses assets provided by someone else. For instance, a previously able person who becomes unable to work may transfer assets to a first-person SNT so they can also qualify for government assistance. The parents of a disabled child may give or bequeath assets to a third-person SNT for the child’s benefit. 

Protecting assets while preserving government benefits

The assets held by an SNT aren’t owed by the disabled person, so they don’t count as their personal property when determining whether they qualify for government benefits. This can be crucial, because Medicaid and some other programs have limitations on the recipient’s income and assets. However, the disabled person is the trust’s beneficiary and the trustee may distribute funds to help them meet their needs in accordance with the trust’s terms. 

Who needs a special needs trust?

SNTs may be useful in a number of situations. For instance, parents planning for a child with disabilities may create a third-party SNT for them. An individual who suffered a debilitating injury in an accident and receives compensation from the liable party might shift those funds to SNT. When prepared correctly, an SNT can make an enormous positive difference for beneficiaries and bring peace of mind to their families.  

How a special needs trust works

The SNT’s grantor transfers assets into the trust and names a trustee. The trustee will be legally responsible for managing and distributing for the disabled individual’s benefit and in accordance with the instructions provided by the grantor. Specific expenses that are paid through the trust could include healthcare, education and personal costs not covered by government programs. A third-person SNT may be revocable, but a first-person SNT must be irrevocable. Otherwise, the government will count the assets toward the beneficiary’s income and personal assets. It’s crucial that the trustee complies with the law and the terms of the trust. I can answer any questions you have about how to establish or administer your SNT.

Why work with an experienced attorney for your special needs trust?

An SNT can be complicated to develop and administer, and it’s easy to make mistakes that can jeopardize its benefits. Personalized counsel from a knowledgeable attorney can help you create a legal instrument that conforms with the law and addressees your particular concerns. I have extensive experience guiding families successful through the process of forming an SNT.

Learn about creating a New Jersey special needs trust in a free consultation

The Paton Law Firm LLC assists North Jersey clients with special needs trusts and other legal instruments designed to safeguard and distribute assets. Please call 201-470-4801 or contact me online to schedule a free initial consultation at my Fair Lawn office.