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| Milestone Consulting, LLC

special needs trust planningEarlier this month, the Senate passed H.R. 34: 21st Century Cures Act, which is now awaiting the President’s signature. The legislation includes the Special Needs Trust Fairness Act in Sec. 5007, which amends the presumption in the original law that all disabled individuals lack the mental capacity to handle their own affairs.

A disabled person or his or her family can set up a special needs trust with assets, such as from an injury settlement or inheritance, to ensure continued eligibility for government benefits. A first-person special needs trust – sometimes referred to as a d4a trust after the federal law 42 USC 1396p(d)(4)(a) – pays directly for non-covered services or medical equipment. The remainder of a first-person trust typically reimburses the government for what it has paid.

Previous Post: What is a Special Needs Trust?

When Congress first recognized d4a trusts in 1993, an oversight in the law means that disabled individuals have to file petition in court to establish their trust if they do not have a parent or legal guardian to set up the trust for them. Even when they are perfectly capable of establishing the trust on their own, disabled people who want to set up a trust are forced to deal with the resulting legal fees and headaches caused by the process.

The settlement planning experts at Milestone know firsthand how big of a deal it will be to amend this law and give the right back to those who are planning their own futures with a special needs trust. We are thrilled to see H.R. 34 pass in the Senate.

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