A Special Needs Trust is designed to provide financial resources to assist a disabled individual who receive government funding. This prevents the department of Public Welfare from taking the money for reimbursement of funds (MA benefits) for the provision of MH/MR.
There are three types of special needs trusts:
Third Party Funded Special Need Trusts funded from someone else's money. The creator must state that the money is to be used to supplement public funding and not replace the public funding. The Trust is irrevocable. The trustee has discretion on the use of the funds.
Self Funded Special Need Trusts Must be created by the parent, grandparent, guardian or court. Discretion of the trustee. Irrevocable. For a disabled beneficiary. Balance is used to payback the state for Medical Assistance. Can't be created after an individual is 65
Pooled Trusts a non-profit fiduciary must be the trustee. Can be created by anyone. Residue remains in trust upon death of disabled beneficiary PA now requires a 50% payback.
Purchases from a Special Needs Trust are to be used to enhance the individuals quality of life. It must be for their benefit. One home, vehicle and a trip with a care giver are examples.
This information is based on Pennsylvania Rules. The guidelines in your state may differ. An attorney should be used by any person wishing to create a trust.
Showing posts with label Planned Giving. Show all posts
Showing posts with label Planned Giving. Show all posts
Monday, March 15, 2010
Thursday, March 11, 2010
Types of Planned Gifts
Traditional Types of Planned Giving
Bequest: Cash or property donated at donor's death. the donor typically makes this bequest through his/her will. Property may include Cash Stocks, bonds, mutual funds &other property which is subject to board approval.
Charitable Gift Annuity: Cash or property donated during the donor's life in exchange for a fixed income for life. Typically $10,000 or more with no additional contributions permitted.
Pooled Income Fund: A common trust donated by separate donors for investment purposes. Each donor receives a portion of the income each year. The charity keeps the remaining assets as each donor's share at the time of death.
Charitable Remainder Trust: Donors create a trust and receive an annual payment. After the last beneficiary passes, the charity receives the remainder of the assets.
Charitable Lead Trust: Donor creates a trust that provides an income for the charity for a period of time. At the end of the period of time, the trust reverts back to the donor or other beneficiary.
Bequest: Cash or property donated at donor's death. the donor typically makes this bequest through his/her will. Property may include Cash Stocks, bonds, mutual funds &other property which is subject to board approval.
Charitable Gift Annuity: Cash or property donated during the donor's life in exchange for a fixed income for life. Typically $10,000 or more with no additional contributions permitted.
Pooled Income Fund: A common trust donated by separate donors for investment purposes. Each donor receives a portion of the income each year. The charity keeps the remaining assets as each donor's share at the time of death.
Charitable Remainder Trust: Donors create a trust and receive an annual payment. After the last beneficiary passes, the charity receives the remainder of the assets.
Charitable Lead Trust: Donor creates a trust that provides an income for the charity for a period of time. At the end of the period of time, the trust reverts back to the donor or other beneficiary.
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