A Special Needs Trust, or a Supplemental Needs Trust, allows for a disabled individual to receive support while still maintaining eligibility for government benefits, such as Medicaid and Supplemental Security Income (SSI).

Generally, funds from a special needs trust cannot be used for basic living expenses including food, shelter, and direct cash payments to the disabled individual. The use of funds from a special needs trust for these expenses can reduce a disabled individual’s benefits.

However, funds from a special needs trust can be used to purchase housing for the disabled individual if the housing is kept in the name of the trust. Furniture, computers, cell phones, and other similar expenses are also acceptable uses for money from a special needs trust. Cars and the costs of car ownership can also be paid for through a special needs trust. Again, care must be taken to make sure these items are purchased by the trust for the benefit of the disabled individual.

Generally, ongoing household expenses should not be paid for through a special needs trust. Rent, food, mortgage payments, property taxes and utilities are examples of items that are considered unacceptable ongoing expenses. Theoretically, these sorts of expenses are supposed to be paid for through the disabled individual’s SSI benefits. 

Individuals should work with an attorney who specializes in special needs law to resolve questions about what housing related expenses a special needs trust can be used for and how best to manage overall costs in caring for a disabled individual.

For help in creating, or managing, a special needs trust to help care for a disabled individual, please call Mitchell, Brown & Associates at (314) 962-0186.