To financially assist a person with a disability is a challenging task. To balance the private resources of a family or individual with public support is a delicate task. Too much on either side tips the scales and the person with a disability may suffer.
Formed in 1989, the San Diego Special Needs Trust Foundation created a master trust to provide private support to persons with disabilities without jeopardizing their public support. Special needs are those things for which you or your family members are not entitled to receive government assistance. The trust is a cooperative project of Access to Independence, The Arc of San Diego, Community Catalysts, Developmental Services Continuum, Friends of Vista Hill, Home of Guiding Hands, NAMI San Diego, St. Madeleine Sophie’s Center, Sharp Healthcare Foundation, United Cerebral Palsy Association of San Diego County, and Unyeway Inc. Through a Special Needs Trust, individuals or family members may leave assets to benefit themselves or their loved ones in a manner that is compatible with the continuation of public assistance.
Individuals with disabilities may direct their personal assets into a First Party/Self-Settled Special Needs Trust to manage the proceeds of personal injury and other litigation, inheritances, and retroactive Social Security payments, any of which might otherwise disqualify them from receiving public benefits. This is a new option offered by the SNTF.
In addition, most families are surprised to learn that they do have a variety of resources within their reach that can be directed to a Third Party Special Needs Trust. The funding contribution options include life insurance policies, estate plans, standard government benefits, and savings.
In both cases (first or third party trusts), contributions are pooled for increased investment leverage, but each individual has a separate trust account. Disbursements are made from individual accounts through a carefully monitored partnership between the trustee and the person's primary service provider.
As little as $5,000 is all that is necessary to open a person’s (trust) account. This is extremely low and more affordable when compared to the minimum deposit required by most banks to set up an individual trust account of this type. At the present time, a one-time processing fee is charged, but only after a Joinder Agreement has been accepted by the Foundation’s Board. Annual trust administration expenses are charged to each person's trust account.
This year an additional two families enrolled in the Third Party Special Needs Trust, bringing the total to sixty-three. Twenty of the accounts are funded and available for distribution. Thirty individuals enrolled in the new First Party Self-Settled Special Needs Trust. Twenty-nine of these accounts are funded and available for distribution.
What Can A Special Needs Trust Do?
A special needs trust holds title to property for the benefit of a child or adult with a disability. A trust can hold cash, stocks, personal property and real property. It can own and/or be the beneficiary of life insurance. The special needs trust can be used to provide for the needs of a person with a disability and to supplement benefits received from various governmental assistance programs. Cash over $20.00 cannot be disbursed to the beneficiary, nor any disbursements made to third parties for food or shelter, without loss or reduction of SSI benefits. The following is a list of example expenditures (distributions) that can be made through the special needs trust set up for you or your family member. This list is not meant to be all inclusive. It is a guideline to suggest ways money may and may not be spent to enhance the quality of life, welfare of a person, and an individual’s happiness:
Examples of Acceptable (Permissible) Expenditures:
- Purchase of a home
- Home improvements (including modifications for handicapped use)
- Home repairs (plumbing, roof, electrical, etc.)
- Cleaning and maintenance of property
- Telephone, TV cable, other “communication” expenses
- Educational expenses (tuition, books/supplies, etc.)
- Medical expenses/bills not covered by Medi-Cal (e.g., annual check-ups)
- Dental expenses, eye glasses, physical therapy, support services not covered by any benefit program
- Social services not covered by any benefit programs
- Insurance premiums (homeowners, health, auto)
- Transportation expenses (including purchase of vehicle, maintenance, gasoline)
- Additional in-home support needs not covered by any benefit programs (such as companion services/home health aide)
- Legal advice
- Advocate for the disabled
- Training programs
- Personal hygiene (haircuts, manicures)
- Entertainment/recreation expenses (books, magazines, movie/concert tickets, sporting events, audio/video equipment)
- Vacation travel (airline tickets, train/bus passes, temporary food & shelter, etc.)
- Athletic training and competitions
|Examples of Trust Distributions which will reduce SSI benefit:
- Shelter expenses (mortgage payments, real property taxes, heating and cooling bills, electricity, water, sewage, garbage collection)
- Groceries or meals
- Cash or any purpose (beyond the $20 SSI monthly allowance)
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