New Opportunities for Trust Planning by Disabled Individuals
On December 7, 2016, the Senate approved the 21st Century Cures Act and the bill is expected to be signed into law President Obama within the next week. Why is this bill so important? It contains the provisions of the Special Needs Trust Fairness Act which gives disabled individuals broader rights in managing their own affairs.
This bill, which has been the centerpiece of the-public policy advocacy of the National Academy of Elder Law Attorneys (NAELA) allows individuals with disabilities to establish their own special needs trusts.
As I discussed in a prior blog, self settled special needs trusts are designed to allow a disabled individual to place his or her own money into a trust and, as long as the trust meets certain Federal requirements, the trust is not considered an asset for purposes of determining eligibility. So, these trusts are important for disabled individuals who may receive a large inheritance or settlement.
Since the creation of self settled special needs trusts in Federal law, the trusts have been required to be created by an individual’s parents, grandparents or a court. Even though the beneficiary’s own funds go into the trust, they have had no control over the terms or provisions of these trust, or the right to create the trust for themselves. This has resulted in needless court intervention in people’s lives to create trusts to protect their assets.
Now, thanks to the hard work of the NAELA Public Policy Committee and many NAELA members, competent, disabled individuals may create their own trusts without asking a court’s permission to do so.
Disclaimer: The THK Legal Blog is for informational purposes only and should not be relied upon as legal advice. In no case does the published material constitute an exhaustive legal study, and applicability to a particular situation depends upon investigation of specific facts. You should consult an attorney for advice regarding your individual situation.