We understand that families with children who have special needs or disabilities face unique and challenging situations. At Roybal-Mack & Cordova, PC, we offer compassionate support and guidance to parents who want to ensure their children will be cared for in the future. Our team is here to help you navigate a special needs trust and the legal and financial aspects of estate planning so you can have peace of mind knowing that your child’s future is secure.
Understanding a Supplemental Trusts
A special needs trust, or a supplemental needs trust, is established for a child or family member with a disability and receives government financial assistance like Medicaid and/or Supplemental Security Income (SSI). A supplemental needs trust is funded through a will, an estate plan, or a life insurance policy.
Third-Party Special Needs Trust– this type of trust is established by a parent, grandparent, or third party. Only assets from a third party can be added to this type of trust.
Self-Settled Trusts- There are two types of self-settled trusts. First, a (d)(4)(A) Trust” or “payback” trust is established by a parent, grandparent, court, or guardian and funded with settlement funds. Still, the State of NM must be reimbursed if funds remain after the beneficiary passes. The second type of self-settled trust is a (d)(4)(C) trust or a “pooled” trust. A non-profit organization establishes a pooled trust and a trustee manages funds. A parent, grandparent, or legal entity creates a sub-account.
This type of trust is irrevocable and does not replace government benefits if appropriately distributed. You must select a trustee who understands how to distribute to the beneficiary so they do not lose government benefits. Our estate planning attorneys will guide you through establishing and structuring a supplemental needs trust.
