Services

Special Needs Trusts Planning

 A Special Needs Trust (SNT) is an excellent way for a beneficiary with disabilities to enjoy the benefit of trust assets while remaining eligible to receive essential needs-based government benefits. While preserving benefits, the irrevocable SNT can provide asset protection and administrative advantages to minors and those who lack the legal capacity to handle their own financial affairs, whether from a physical or mental disability.

Prudent Investors supports SNT trustees through the often complex process of finding attorneys to draft the trust, monitor assets, and manage the trust assets. We work with the trustee’s team or can put trustees in touch with needed resources, whether legal assistance, accounting, healthcare, Medicare compliance, or fiduciary support services.

The creation of an SNT is often the result of a personal injury or medical malpractice settlement, designed to compensate the injured party and hopefully provide financial resources to last a lifetime. PIN can assist in the settlement discussions by working with attorneys and trustees to determine the optimal allocation between a structured settlement and a cash settlement. Using the life care plan, PIN is able to model financial needs while taking inflation, anticipated future needs, and fluctuating market returns into consideration.

Special Needs Trust trustees have a legal obligation to invest SNT assets according to the Uniform Prudent Investor Act (UPIA), a uniform trust and probate law enacted by almost all states. The liability a trustee assumes is substantial and often not well understood. As instructors in the Trustee Certification Program at California State University at Fullerton, Prudent can help the trustee minimize liability by staying compliant with UPIA requirements to monitor returns, risk, and diversification.

Oftentimes, the needs of the beneficiary are substantial and Prudent can assist the SNT trustee by determining the appropriate asset allocations, managing investment portfolios, complying with UPIA, conducting regular reviews including compliance reviews, and providing required reports as needed. Prudent can assist in optimizing tax efficiency whether the SNT is a first-party special needs trust or a third-party special needs trust. The potential tax burden on a third-party special needs trust can be substantial and tax considerations can have a significant impact on outcomes.

Working with public, private, and family fiduciaries on Special Needs Trust investments for decades has given Prudent Investors Network unique insights into both private and court supervised SNTs. The insights have cultivated a sensitivity to the concerns, fears, and vulnerabilities of beneficiaries. We feel it a privilege to be able to assist trustees in maintaining and enhancing the quality of life for beneficiaries throughout their lives. It is one of the most rewarding parts of our professional careers and we would be honored to assist you.