Tag Archives: non-profit

Briefly, What is a Special Needs Trust?

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Many times we’re asked at The Special Needs Network, “Just what is a Special Needs Trust?” The “elevator speech” answer is:

A Special Needs Trust (SNT) contains the assets of an individual who is disabled, and protects those assets from being counted as a resource for means-tested public benefits such as Supplemental Security Income (SSI), Social Security Disability Insurance (SSDI), Medicaid and Medicare. In the United States SNT’s are also known as Supplemental Needs Trusts and can have unique advantages in relation to the provision of health care, long-term care, and nursing home care benefits especially when using Medicaid.

Because The Special Needs Trust Network is a “Pooled Special Needs Trust” we also get asked what that is..Simply put a “pooled” Special Needs Trust (SNT) is a trust that “pools” all beneficiary funds together for investment and administrative purposes while maintaining an individual sub-account for each beneficiary. A self-settled pooled SNT like the one run by The Special Needs Trust Network is authorized by a specific Federal stature: 42 United States Code, Section 1396p (d) (4) (c) and therefore is often referred to as a d4c trust. This same statue says that pooled trusts could be administered by non-profits and there are now non-profit pooled trusts operating in all fifty states.

The beauty of the pooled trusts is that we don’t have to accept only large amounts of money because we pool all of the money into one master trust. Beneficiaries receive interest and capital gains earnings on their investment principal in direct proportion to the percentage of the pool the money in their sub-account represents. Many banks and investment companies won’t create trusts for anything under $1 million dollars, and even with $250,000 many times beneficiaries have a hard time finding an investment partner to create an SNT. A non-profit pooled trust like The Special Needs Trust Network will help clients of all financial ranges from five-figures on up to beyond $1 million.

Special Needs Trusts are used frequently to:

  • Receive an inheritance
  • Accept a personal injury settlement
  • Collect Insurance settlements
  • Receive Windfalls
  • Collect back payments

Receiving money in any of these ways without having a proper SNT set up can cause a disabled person to lose some or all of their needed benefits. Contrary to many sensational news stories regarding large settlements we see individuals who many times receive far less than $100,000. Asset guidelines for an individual applying to qualify for Medicaid or who are on Medicaid have to meet SSI guidelines which are:

  •  Single applicant no more than $2,000 in countable assets
  • Married applicant no more than $3,000 in countable assets

As you can see just accepting the normal back payment from SSDI, which is usually around $10,000, after waiting to qualify can cause someone to potentially lose benefits. You can see why a properly set up and administered pooled SNT can help those people who need it the most. In future blogs we’ll discuss the two types of SNT’s; first party and third party, as well as expand upon the benefits of these trusts.

If considering an SNT please talk to a qualified and certified elder care or trust attorney easily found at both The National Elder Law Foundation (NELF), and The National Academy of Elder Law Attorneys (NAELA).  Please check back for further information regarding SNT’s their variations, uses, and benefits, and as always we look forward to your questions and comments.

Happy First Birthday SNTN!

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Birthday cake, first birthday

Happy Birthday, SNTN!

First years of anything are exciting, challenging, fun, and sometimes stressful. Think back to your first year of college, your first job, or your first year as a parent. But first years also go by very quickly! All of us at The Special Needs Trust Network (SNTN) have experienced all of these same emotions over this past year on our way to starting a new non-profit, reaching out into the community, and working with new clients.

It seems so long ago in early 2010 that Rita Blackwood and myself attended a Colorado State University career event and I mentioned my desire to join a non-profit board. Rita responded with the surprising comment that she was happy to hear me say that as she was looking at starting a new non-profit special needs trust and wanted to ask me to join her. She then said, “Do you think the rest of Team C would like to help?” I responded that I thought they would and suggested she send an email that evening. Early the next morning Donna Sue and David had agreed to join in.

“Team C” consisted of Rita Blackwood, Karen Bordner, Donna Sue Mastalka, and David Cutler. We were put together as complete strangers during our first week during a class at CSU’s Executive MBA program and we stayed together as a study team for the twenty-one month program. Through weekly classes, study group meetings, writing papers and developing presentations we shared intelligent conversations, laughs, a 10 day international study tour with our entire class during the hottest summer on record for Europe, and yes I’ll admit to a few drinks being involved! After graduation we’ve remained friends, attended CSU events or additional classes, and enjoyed each others company without the stress of what next project was due for class. Rita, David, and Donna Sue are three of the most amazing individuals I’ve ever met and I’m grateful and honored for their friendship. As a group we’re thankful, happy, and proud that CSU’s Department of Business decided to profile us in just our first year of operation with the article, “Executive MBA Graduates Working to Protect the Assets of the Disabled.” 

We started The Special Needs Trust Network (SNTN) to offer a special needs pooled trust in the state of Colorado, reach out to various disability groups directly and by using social media, and offer a high standard of financial, care management, and advocacy to clients. Over 2010 we met monthly and worked virtually to develop business, marketing plans, financials, bylaws, operating agreement, trust documents, company mission and narrative along with filling out the IRS 1023. While waiting for the IRS decision we continued working on strategy, working with a wonderful artist Dave Staub/Element 95 on our logo design and a fabulous writer, Mari Christie to design our brochure, web content, and web page, and interviewed financial institutions to find the best and most secure options for our clients investments.

And finally on February 23, 2011 we received the IRS Letter of Determination! By coincidence this fell on the night of our monthly board meeting and while we celebrated that night we knew the work wasn’t over but had only just begun. As a special needs pooled trust the state of Colorado’s Department of Health Care Policy and Financing (HCPF) had to review and approve our trust documents but only after we received our 501c3. We were still along way from accepting and helping clients, but we were one step closer.

So tonight at another board meeting we will celebrate one year of having our 501c3 status as well as meeting yearly goals and moving forward in serving those who are truly in need or our services. Stay tuned for more updates, and information as we move into our second year.

Happy 1st Birthday, SNTN!