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Personal Injury and Special Needs

What happens if a person with special needs is injured?  What happens when that person receives a settlement and is on government benefits?  When should a person consider a First-Party Special Needs Trust? Estate Planning is especially important when the loved one relies on access to state services or government benefits. 

Government Benefits

People with disabilities who receive Supplemental Security Income (SSI)  cannot have more than $2,000 in countable income.   If a personal injury settlement is paid directly to a person, SSI is lowered, and in some cases suspended. The current countable source for Medicaid in Missouri is $5,000 for a single person.  Payments made to a person on Medicaid jeopardizes eligibility. Medicaid may be suspended until the resource is below $5,000. How does a person with a disability, a settlement , and government benefits, strike a balance to keep benefits and increase a quality of life with a settlement.

Structured Settlements

Using a Structured Settlement only approach is problematic.  A structured settlement provides a steady stream of income.  Why is that a problem?  If it is paid directly to the beneficiary, the payment may cause someone to lose government benefits. On the other hand, a safer and powerful method is to pay the settlement in a SNT as an annuity. The money funds A Medicaid compliant annuity in the name of the Trust. The Trust holds the annuity, which keeps the money from being spent too quickly. The Trustee keep the trust in compliance for government benefits.  A structured settlement paid into first-party special needs trusts is a step that gives peace of mind.

Why a First-Party Special Needs Trust?

How does a First-Party Special Needs Trust (SNT) help a person on government benefits with a personal injury settlement?  A personal injury settlement paid directly to the injured client jeopardizes government benefits. SSI is lowered dollar for dollar if the settlement is used for food or shelter. If the settlement is used for anyone else or money given as a gift it may cause a person to lose the government benefit. Creating a First-Party Special Needs Trust helps a person preserve government benefits and still benefit from a personal injury settlement. 

Take Action

When a child or another family member has special needs, there needs to be an extra layer of protection in an estate plan for that person. The First-Party Special Needs Trust protects your benefits. Tucker Legal Services works with personal injury lawyers who have clients on government benefits receiving a settlement.  If you will receive a personal injury settlement and want to keep your benefits, Call me at 314.332.0011. Book your consultation today for estate planning and elder law issues.

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Sheri Tucker

Your Personal Care Attorney. Owner and Founder of Tucker Legal Services, LLC. I'm an attorney licensed since 1991 with a M.S. in Psychology. Member of ABA, MOBAR, BAMSL, Elder Counsel, Wealth Counsel, and National Academy of Elder Law Attorneys (NAELA).

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