Caring for a loved one with special needs requires careful financial planning. In Oklahoma, you can set up a special needs trust to give essential financial support without risking their chance to get government help. Here is how to make a special needs trust:
Types of trust
Oklahoma has three main types of special needs trusts:
- First-party: A first-party special needs trust uses the beneficiary’s money, such as an inheritance or legal settlement. It must reimburse Medicaid after the person dies.
- Third-party: A third-party special needs trust uses money from others, such as parents or grandparents. It does not need to pay Medicaid back; the grantor can set it up while still alive.
- Pooled trust: A nonprofit group runs a pooled trust. It mixes money from many people to invest but keeps each account separate. The person or others can add money to it and must pay Medicaid back when the person dies.
Your choice of trust type will affect how you manage the funds and what happens to any remaining assets.
What you need to consider
- Talk to a lawyer: Work with an Oklahoma trust lawyer to draft a document that follows the law and meets your loved one’s needs.
- Pick a trustee: Choose a good trustee who will handle the money, distribute funds, and follow trust rules and government laws.
- Draft the trust document: Make a detailed document describing what the trust is for, what the trustee must do and how the money can help your loved one.
- Fund the Trust: For third-party trusts, move money into the trust, including gifts from family. For first-party trusts, use the beneficiary’s own money.
- Following the law: Ensure the trustee knows what they must do, like reporting and following Medicaid and SSI rules.
Each step is critical to making an excellent legal trust.
Benefits of a special needs trust
A special needs trust protects assets without hurting chances for critical government help like Medicaid and SSI. It can pay for things that improve life, like medical care, school, travel and personal care.
What to do next
Setting up a special needs trust needs careful planning and legal help. Following these steps can make your loved one’s future safe and meet their needs. To start or learn more, talk to an Oklahoma trust lawyer today.
Remember, each case is different. Fit your plan to your loved one’s needs for the best result.