Special Needs Trusts in Missouri
Leaving money directly to a loved one with a disability can disqualify them from needs-based benefits like SSI and Medicaid. A special needs trust holds those funds for them instead, so the money can improve their quality of life while their benefits stay in place.
Two Main Types of Special Needs Trusts
| Third-party trust | First-party trust | |
|---|---|---|
| Funded with | Assets of parents, grandparents or others | The beneficiary’s own assets (inheritance, settlement, savings) |
| Medicaid payback at death | Not required | Required, up to the Medicaid paid |
| Age limit | None | Beneficiary must be under 65 when it’s created |
| Common use | Parents planning for a child’s future | A beneficiary who receives money directly |
What a Special Needs Trust Can Pay For
The trustee can use trust funds for needs that benefits don’t cover, such as education, therapies, recreation, travel and equipment. The trustee must follow benefit rules carefully, because some payments can reduce benefits.
Choosing a Trustee
The trustee needs good judgment and an understanding of SSI and Medicaid rules. Many families name a relative and pair them with professional guidance.
Frequently Asked Questions
Can a special needs trust be part of my will?
Yes. A third-party trust can be created in your will or as part of a living trust.
Can grandparents and others contribute?
Yes, a third-party trust can receive gifts and inheritances from anyone other than the beneficiary.
What happens to the trust when the beneficiary dies?
A third-party trust passes to the people you name. A first-party trust must first repay Medicaid.
Planning for a loved one with special needs? Call Legal Hero at 314-816-3081.