When a loved one has a disability or needs long-term care, families often face a painful dilemma: how to provide financial support without jeopardizing critical benefits like Medicaid or Supplemental Security Income (SSI).
This is where Special Needs Trusts (SNTs) and Medicaid Asset Protection Trusts (MAPTs) step in. These trusts aren’t just legal tools—they’re lifelines. They protect eligibility for essential programs while ensuring long-term financial security for loved ones.
The Role of a Special Needs Trust
A Special Needs Trust (SNT) is designed to hold assets for a person with disabilities without disqualifying them from needs-based government benefits.
Why it matters: SSI and Medicaid have strict asset limits (as little as $2,000 in countable resources). Inheriting money outright can cause benefits to stop.
How it helps: An SNT pays for supplemental needs—things like therapies, education, recreation, or home modifications that enhance quality of life.
Types:
- First-Party SNT: Funded with the beneficiary’s own assets (like a lawsuit settlement).
- Third-Party SNT: Funded by family members (inheritance or gifts).
With an SNT, loved ones receive both government support and family-provided care enhancements.
The Role of a Medicaid Asset Protection Trust
A Medicaid Asset Protection Trust (MAPT) helps seniors prepare for the possibility of long-term care.
Why it matters: Nursing homes can cost $7,500–$10,000+ per month, and Medicaid is the only program that covers this long-term. But Medicaid requires strict financial eligibility.
How it helps: By transferring assets into a MAPT at least 5 years before applying for Medicaid, families can protect a home, savings, and investments while still qualifying for care coverage.
Result: Assets are preserved for a spouse or future generations instead of being spent down on nursing home bills.
How These Trusts Work Together
Both SNTs and MAPTs share a common goal: protecting family wealth across generations while maintaining vital benefits.
- For a child with special needs: An SNT ensures lifelong support and security without losing Medicaid or SSI.
- For an aging parent: A MAPT shields assets from long-term care costs, preserving an inheritance for children and grandchildren.
Together, these trusts create a framework where families can support vulnerable loved ones without sacrificing financial stability.
Final Takeaway
Estate planning isn’t just about dividing assets—it’s about caring for the people who matter most. Special Needs Trusts and Medicaid Asset Protection Trusts allow families to provide financial support, protect eligibility for government programs, and pass wealth safely to the next generation.
By using trusts that care, you give your family peace of mind today and security for tomorrow.
Do you have a loved one with special needs—or concerns about future long-term care? Our attorneys can help you design trusts that protect benefits, preserve assets, and care for your family across generations. Contact us today to get started, or explore our estate planning services.
