William Sweeney


The central purpose of a Special Needs Trust ("SNT") is to set aside assets for a disabled beneficiary without elimination of the beneficiary's eligibility for "needs based" public benefits such as SSI or Medicaid. A SNT can accomplish this because the Social Security Administration does not count the SNT asset(s) as assets of a SSI or Medicaid recipient.

For a number of years it was uniformly assumed under the law that an individual who qualified for means-tested government benefit programs such as Medicaid and Supplemental Security Income (SSI) was in all instances mentally incapable of managing his/her own financial and other affairs and therefore the laws which applied to the establishment of SNT always required that such vehicles were established by other persons (other than the special needs person) in favor of the special needs individual.

The requirement that someone act on behalf of a disabled person to establish a SNT was viewed by many as an oversight in the prior law, OBRA-93. On December 13, 2016, President Obama signed a new law that allows First Party Special Needs Trusts to be established by mentally competent individuals for their own benefit. This is a major "fix" to the current law which only allows First Party Special Needs Trusts to be set up by a parent, grandparent, guardian or a court.

Distinct from Third-Party SNTs

Self-settled SNTs shouldn't be confused with thirty-party SNTs, which are trusts funded with assets from family members or other sources, and not with the individual with disability's own assets. Third party SNTs are a common estate-planning tool used to improve the quality of life of the individual with disabilities. Unlike self-settled SNTs, assets held by third-party SNTs don't have to be used to repay the Medicaid program for the cost of care provided to the individual with disabilities. Instead, the assets can pass to other family members on death of the individual with disabilities.


If you or anyone you know is a person who qualifies for means-tested government benefit programs, such as Medicaid and Supplemental Security Income (SSI), and is about to receive an inheritance, it is time to plan to avoid the loss of the beneficiary's eligibility. If you wish to gain more information please contact me for a free consultation. I will spend time with you to answer your questions. From my office in Southern California, I represent families in all California counties, including Southern California Counties such as Imperial County, Los Angeles County, Orange County, San Bernardino County, and San Diego County. I also represent parties residing outside of California that have probate matters affecting real and/or personal property in California..

To schedule a consultation, call me toll free at 800-575-9610 or locally at 760-989-4820. I enjoy meeting in person whenever possible, but am also available via Skype and email or through my online contact form.

Disclaimer: This article is intended to provide general information. The content of this publication is for informational purposes only. Neither this publication nor its author is rendering legal or other professional advice or opinions on specific facts or matters. No attorney-client relationship is created by this advisory, nor by any response to the information herein, unless and until a conflicts review has been conducted by William K. Sweeney, and a written agreement containing all terms of representation has been signed.

Copyright © 2017, William K. Sweeney, Attorney at Law. All rights reserved.