Special Needs Trusts

A special needs trust (SNT) is a legal document that is used to protect assets to create or maintain eligibility for public benefits available to a person with a disability. In order to qualify for these means-tested benefits, a person is defined as “disabled” by the Social Security Administration if the person has a “medically determinable physical or mental impairment which results in the inability to do any substantial gainful activity and can be expected to result in death, or has lasted or can be expected to last for a continuous period of not less than 12 months.”

Some available means-tested public benefits include Medicaid (or Medical Assistance as it’s known in Pennsylvania), the Medicaid Home and Community Based Services Waiver programs, Supplemental Security Income (SSI), Social Security Disability Insurance (SSDI), and Medicare. These public benefits allow a disabled person to pay for defined expenditures that are critical to their well-being and quality of life. 

The assets which are transferred to an SNT for the disabled person are intended to supplement, not supplant, their public benefits. In general, allowable expenditures from an SNT include medical care, clothing, and transportation, but typically do not include food and shelter.