Special needs trusts are designed to permit financial resources to remain available to assist a disabled individual who receives, or may receive in the future, MH/MR and/or medical assistance and/or SSI benefits. Special needs trusts also protect resources from immediate invasion by the Department of Public Welfare (or other providers of publicly funded services) to reimburse the public treasury for the provision of MH/MR, MA, or SSI benefits. There are common law discretionary trusts which are funded by a third party, OBRA-93 payback trusts which are self-settling trusts with the disabled beneficiary’s own monies, and pooled trusts which involve a non-profit fiduciary.
Special needs trusts are commonly used to assist disabled beneficiaries. They are the product of both common law and statutory law. Each special needs trust requires individualized treatment. Court approval is required in the creation of a special needs trust. These trusts come with wonderful advantages as well as certain limitations. We will advise you as to allowable and nonallowable expenses of your special needs trust funds.
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