Porzio, Bromberg & Newman, P.C. | Contents of this website may contain attorney advertising | Results may vary depending on your particular facts and legal circumstances
If you have a loved one with a disability, planning for their long-term care is essential. A Special Needs Trust in New Jersey is a legal tool that allows families to set aside funds for someone with special needs—without affecting their eligibility for government benefits like Medicaid or Supplemental Security Income (SSI).
Creating this trust may seem complex, but with the right legal guidance and understanding, it can be a smooth and strategic process. In this blog, we’ll explore key legal tips to help you get started.
A Special Needs Trust (SNT) is a type of legal structure intended to give someone with a disability financial support. It protects their eligibility for government programs by ensuring assets are managed by a trustee, not owned by the beneficiary.
These trusts cover expenses not provided by government assistance, including:
By setting up a Special Needs Trust in New Jersey, families can offer their loved one a better quality of life—without putting crucial public benefits at risk.
Special needs trusts come in three main varieties. Each serves a different purpose:
This trust is funded using the beneficiary’s own money—such as from a legal settlement, inheritance, or life insurance payout. It must include a Medicaid payback provision.
Funded by parents, grandparents, or others, this trust is typically part of an estate plan. It does not require a Medicaid payback clause and offers greater flexibility.
Managed by a nonprofit, pooled trusts combine the resources of many beneficiaries for investment purposes but maintain separate accounts. These are helpful when a professional trustee is preferred or necessary.
✅ Choosing the right trust depends on your financial goals, the source of funds, and your loved one’s unique needs.
Laws governing special needs trusts can vary by state. That’s why working with an experienced Special Needs Planning Attorney in New Jersey is essential.
A qualified attorney will:
💼 An attorney ensures your trust is both legally sound and tailored to your family’s situation.
The trustee plays a critical role in managing the trust and making distributions. This person or organization must act in the best interest of the beneficiary at all times.
When choosing a trustee, consider the following:
If no family member is a good fit, a professional or corporate trustee may be the best option. They offer experience and neutrality, which can be especially helpful in complex situations.
A Special Needs Trust in New Jersey should be used for expenses not covered by government programs. Improper distributions can cause the beneficiary to lose SSI or Medicaid benefits.
Allowed expenses often include:
⚠️ Avoid giving cash directly to the beneficiary or paying for food and shelter unless you’ve consulted your attorney.
Life circumstances and laws change. What works today may not be ideal in five years.
Regularly review your trust with your attorney to:
🔁 Annual reviews are a smart way to keep your trust current and effective.
Creating a Special Needs Trust in New Jersey is one of the most loving and responsible actions you can take for a family member with a disability. It offers long-term security, protects access to public benefits, and enhances their quality of life.
With proper legal guidance, careful planning, and ongoing review, your trust will provide meaningful support for years to come.
✅ Ready to protect your loved one’s future?
Work with a trusted New Jersey special needs planning attorney today to create a customized, compliant, and compassionate special needs trust.
