A trust is a legal document that details how your assets should be distributed after your death. The individual creating the trust is the “Grantor.” The Grantor names a “Trustee,” or person to administer the trust. Their job is to follow the guidelines set up by the Grantor to the best of their ability. Successor Trustees are also named in case the initial Trustee is unable to serve.
There are many different types of trusts. The most common trust is a Revocable Living Trust, or Revocable Trust, where the instructions of future distributions can be changed at any time by the Grantor during his or her lifetime. Another type of trust is an Irrevocable Trust which does not allow any changes after execution of the trust.
Special Needs Trusts (SNT) have distinct features and advantages. There are a number of different SNTs including First Party SNT, First Party Self-Settled SNTs, Third Party SNTs and Pooled SNTs. Depending on your situation, it may even make sense to establish a Special Needs Trust as a pop-up trust inside your Revocable Living Trust. In this situation, the SNT will only be created if certain parameters are triggered.
It is important to select the right type of trust or trusts based on your unique circumstances. Making the wrong decision could impact your loved one’s government benefits and/or ultimately who receives any assets left over after your loved one passes away. Therefore, it is important to consult with your estate attorney and Social Security Disability attorney to create the best fit for your situation.
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