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Disadvantages Of Special Needs Trust

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Special Needs Trust (SNTs)

When are Special Needs Trusts used?
SNT – A Special Needs Trust is set up for a person who receives government benefits so it doesn’t disqualify the beneficiary from said benefits, such as Social Security Income or Food Stamps/Cash Assistance. This is completely legal and permitted under the Social Security rules provided that the disabled beneficiary cannot control the amount or the frequency of trust distributions and they cannot revoke the trust. By establishing a trust, which provides luxuries or other benefits which otherwise could not be obtained by the beneficiary, the beneficiary can obtain benefits from the trust without defeating his or her eligibility for government benefits.
Usually a special needs trust has a provision which terminates the trust if it could be used to make the beneficiary ineligible for government benefits.
ABLE Act Accounts – Tax-advantage savings accounts for individuals with disabilities and their families. Created since the passing of the Stephen Beck Jr., Achieving a Better Life Experience Act of 2014. Contributions to an ABLE Act account are not tax-deductible, but all investment earnings remain untaxed as long as money taken from the account is used for qualified disability expenses. Such as, medical treatment.
Types of Special Needs Trusts
Third Party Trusts – Third Party Trusts are trusts that are created by a third-party individual(s) who contribute assets of their own for the benefit of a person with a
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