A special needs trust is a legal document that allows a person with disabilities to maintain their independence and quality of life. Many people with disabilities live in group homes or with family members, but there are some situations where it is preferable for them to have their own homes. Can a special needs trust own a house? Let's take a closer look at the answer to this question!
Can a Special Needs Trust Own a House?
Special needs trusts are created for the benefit of a person with disabilities. The trustee of the trust is responsible for managing the assets of the trust and using them to pay for the care and support of the beneficiary. One common question about special needs trusts is whether or not they can own property, such as a house.
The answer to this question depends on the type of special needs trust that is being used. There are two main types of special needs trusts: first-party trusts and third-party trusts. First-party trusts are funded with the disabled person's own assets, while third-party trusts are funded with assets from someone else, such as a family member or friend.
If a first-party trust owns a house, the disabled person is actually considered to be the owner of the property. If not done correctly, this can have some serious consequences, such as making it difficult to qualify for government benefits like Medicaid. In some cases, it may even cause the disabled person to lose their eligibility for these benefits entirely!
Third-party trusts are not subject to the same rules and regulations as first-party trusts. This means that a third-party trust can own property without any negative consequences for the beneficiary. In fact, owning property in a third-party trust can actually help a disabled person qualify for government benefits!
We’re Here to Help
If you're considering setting up a special needs trust, it's important to talk to an experienced financial professional who can help you choose the right type of trust for your situation. They can also provide you with more information about how owning property in a trust can impact your benefits eligibility.
Call Legacy Enhancement Trust today at (888) 988-5503 or fill out the online contact form to learn how we may assist you!