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New law makes change to the rules on special needs trusts

On Behalf of | Dec 22, 2016 | Trusts |

When a person has a disability, a lot of unique financial issues can come up for them. This includes issues related to things such as saving money, long-term care costs and public benefits eligibility. Special needs planning may be able to help with preparing for such issues and protecting the interests of a person with disabilities when it comes to such issues.

There are a range of different things that special needs planning could include. Among these is the use of a special needs trust.

There are various rules related to these trusts. Recently, some changes were made to the rules on who can form such a trust.

Under the old rules, such trusts could generally only be created by the courts or by a legal guardian, parent or grandparent of the individual the trust was for. The rules did not authorize a person with disabilities to create their own special needs trust.

A federal law was recently signed by the president that changes this. Under this new law, the list of people who can form a special needs trust has been expanded to include the person with disabilities that the trust is for. The change took effect upon the law’s signing.

One wonders what impacts this rule change will have regarding the use of special needs trusts.

Whether a person is engaging in special needs planning for a loved one or for themselves, it can be important for them to understand what options are out there for their planning and how well-suited the different available options would be for their or their loved one’s particular circumstances. Attorneys experienced in special needs planning matters can provide individuals with information and guidance on the options and issues related to such planning.

Source: Disability Scoop, “New Law Expands Access To Special Needs Trusts,” Michelle Diament, Dec. 16, 2016