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Why is it important to keep public benefits?

Published February 25, 2009

People who leave a large sum of money to a loved one with a disability are always doing so with the best intention at heart. On its face, a lump sum in the tens or hundreds of thousands of dollars seems like a gift that will help care for your loved one for a long time. However, this is not always the case.

For example, take an individual who is currently receiving disability benefits as well as public assistance for medical care. He receives a sum of $150,000 as a gift from a well-intentioned aunt. That money will be considered income and will cause him to lose his medical and disability benefits. Within three years, the cost of daily and medical care has depleted the gift. At that time, he will need to reapply for government benefits and may be left with no means to cover medical expenses while he is waiting for the  new benefits to take effect.

The good news is, t is possible to leave money to a loved one without hindering their ability to receive government benefits. The way to do this is to establish a special needs trust. Your estate planning lawyer can advise on the best plan for your individual needs.

To learn more about Special Needs Planning, visit

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