12/14/2016 Update: President Obama signed the Special Needs Trust Fairness Act into law yesterday allowing individuals with disabilities to establish their own first party special needs trusts.
Good news! While not much has gotten done in Washington recently, some good news to report from the beltway. Yesterday, the Senate passed the Special Needs Trust Fairness Act, which had already passed in the House of Representatives. This Act allows individuals with disabilities, who have capacity, the ability to establish their own first party special needs trust.
Prior to the passage of this law, capable individuals with disabilities had to rely upon parents, grandparents, legal guardians and the courts to be able to establish this type of trust on their behalf. This was due to a glitch in the law that existed since its enactment over 20 years ago.
A first party special needs trust is an important planning tool if the individual with disabilities receives money outright, including through an inheritance, a personal injury settlement or child support. With this type of trust, the individual is able to protect these monies, while maintaining eligibility for much-needed government benefits, including SSI and Medicaid. The President is expected to sign the Special Needs Trust Fairness Act soon.
Please contact us if you or someone you know could benefit by having a special needs trust set up.