Nashville Special Needs Trust Lawyer

Nashville Special Needs Trust Attorney

When a family member or other loved one is disabled or otherwise relies on government benefits for their support, it can complicate estate planning. You want to provide them support, both now and after you pass, without threatening their benefits eligibility. Specific types of trusts may be the right solution. Reviewing your loved one’s needs and circumstances with a skilled Nashville special needs trust lawyer can help you determine the options available to you.

A trust is an estate planning tool that keeps assets in an independent legal entity. This adds additional protection and privacy. A special needs trust is one specific form a trust can take, which can preserve the interests and well-being of a disabled beneficiary.

Estate Planning for Disabled Beneficiaries in Nashville

Legal representation while creating a trust and complete estate plan is essential to its success. An attorney can help you understand your options when creating a special needs trust and what terms may be beneficial for your unique situation. Emmack Probate and Estate Law Group has worked for years in estate planning law, including the establishment of special needs trusts for disabled, ill, and elderly beneficiaries.

Attorney Shanone Emmack will take the time to understand your estate planning goals and the unique needs of your intended beneficiary. She can establish a funded and enforceable trust that preserves your assets and places an individual you trust as the trustee. 

What a Special Needs Trust Provides

A special needs trust or a supplement needs trust, is a legal document that protects and preserves certain assets for a beneficiary who relies on governmental benefits. This is typically an elderly, injured, chronically ill, or disabled beneficiary. Governmental benefits, like Supplemental Security Income (SSI) or Medicaid, require individuals to not exceed a certain asset or income cap in order to be eligible for the benefits.

Under this asset and income limitation, it is difficult to provide individuals you love with assets and benefits. A disabled beneficiary who receives an inheritance might then be unable to receive their vital benefits. A special needs trust allows individuals to provide inheritance to their loved ones without threatening the benefits that they rely on. The assets are not held in the individual’s name but allow them to improve their quality of life and afford more than basic essentials. This approach is often essential in probate law and trusts law, ensuring that the inheritance is properly managed and structured to protect the beneficiary’s eligibility for government benefits while maximizing their financial well-being.

What Are the Pros and Cons of a Special Needs Trust?

There are several pros and cons to a special needs trust, and it’s important to consider them carefully in your unique situation. Some of the benefits of a special needs trust include:

1. Supplemental Income: Governmental benefits give disabled and elderly individuals essential support for basic needs. However, individuals may need or want non-essentials that they cannot afford on benefits. If the benefits are used for essential services, this can count against benefits, but there are many potential things that can be covered with inheritance. The inheritance in a special needs trust allows them to pay for things like education tuition, vacations and travel expenses, recreational and leisure items and equipment, certain utilities, therapy, a vehicle, and other items considered non-essential.
2. Tax Deductible: The assets and funds in a special needs trust are tax deductible, providing additional benefits for a family and the grantor.
3. Asset Protection: Depending on the type of trust used, a special needs trust can keep assets protected from creditor claims or court judgments. This protects the assets and ensures they are only used for the supplementary support of the beneficiary.
4. Fiduciary Duty Protection: The trustee in a special needs trust has a fiduciary duty to act in the interests of the beneficiary. This can help protect a disabled beneficiary from exploitation, which can be a concern if a beneficiary’s funds are managed by an individual without this duty. A trustee has a legal responsibility to use the funds for the benefit of the beneficiary.
5. Customizable Inheritance Planning: A special needs trust can be established with terms that fit a family’s needs, including the beneficiary’s needs. Whether a beneficiary is mentally or physically disabled, chronically ill, or elderly, the trust can be tailored to their specific type of support.

While there are many benefits, there are some potentially negative aspects of this trust. Some of the drawbacks of a special needs trust include:

1. Costly to Establish: It is costly to create and administer any trust, including a special needs trust in at Nashville. There is a significant investment, and the trust is required to be maintained. There may also be tax consequences for the trust. It’s important to consider all the potential expenses with legal support so you and your family understand the financial consequences of establishing the trust.
2. Lack of Beneficiary Control: While a trustee has a fiduciary duty to the beneficiary, the trustee has control of the trust. The beneficiary does not control the funds, which can prevent them from being independent and making their own decisions about their financial and personal future.

   A beneficiary must request access to funds, and the trustee decides whether they will honor it based on the beneficiary’s interests. It’s important to discuss these issues with a beneficiary and legal counsel.

3. Medicaid Payback: When the special needs trust is terminated, either on the death of the beneficiary or through legal termination, the trust has to pay back Medicaid. This can result in no funds being left in the trust for other family members, although the termination of the trust typically occurs because its purpose was served in supporting the beneficiary.

It’s important to discuss these negatives with an Nashville special needs trust attorney in Tennessee and the relevant individuals affected by the establishment of the trust. Different solutions may be necessary depending on your financial situation, the assets available to you, and the needs of a beneficiary.

Get Help from Our Special Needs Trust Team for Legal Support

An improperly created special needs trust can result in a loved one not receiving beneficial income or even being harmed financially. It is crucial that you establish a trust properly, and this is easier with a skilled and knowledgeable estate planning attorney.

Emmack Probate and Estate Law Group can help you and an intended beneficiary create and draft a trust that protects the interests of your loved one. Contact the firm today and see how Shanone Emmack and her team can help with your estate planning needs.