Do you have a loved one with special needs? Have you considered a First Party Special Needs Trust as a part of your California estate plan? Either way, you may be all too familiar with the unique concerns associated with having a loved one with special needs. For instance, do you worry about your loved one receiving the continued care and assistance he or she needs on a daily basis? Do you have concerns about the continued receipt of government benefits and the things that may jeopardize the continued participation in these need-based government programs? 

These are all valid concerns. You may be able to find comfort knowing that there are legal tools available that can help ensure that your special needs loved one continues to receive government benefits even in the event that he or she acquires a significant amount of property or assets. This can be accomplished through a first party special needs trust in California.

A first party special needs trust is a trust funded by the person with special needs for his or her own benefit. This is different from a third-party special needs trust, which is funded by property from someone other than the special needs beneficiary. There are a number of ways a person with special needs might acquire a significant amount of assets. For instance, he or she may have received an award from a personal injury claim, been the beneficiary of a life insurance policy, or received an inheritance. Regardless of how the person with special needs acquired the property, such acquisition of assets can easily jeopardize his or her eligibility for government benefits.

Through placing the acquired assets in a first party special needs trust, the trust takes ownership of the assets and, thus, removes them from the government’s calculations for benefit qualification. The trust must comply with stringent government regulations and be properly funded. When this is accomplished, the trust can disburse funds for qualifying purposes for the benefit of the special needs individual without jeopardizing government benefit eligibility.

When properly executed, a first party special needs trust can allow your loved one with special needs to remain eligible for the continued receipt of government benefits, such as Medi-Cal, while allowing them to reap the benefits of those resources held in the special needs trust. For assistance in setting up a first party special needs trust and establishing other plans and protections for your special needs loved one, our office is here to help. Please reach out to us to schedule a meeting time.