Special Needs Trusts in Missouri and Kansas
Protecting Benefits While Providing for Your Loved One — Liberty, MO Special Needs Trust Attorney
Families with a loved one who has a disability face a planning challenge that most estate planning attorneys are not well-equipped to handle. Leaving assets directly to someone who receives SSI or Medicaid can disqualify them from those benefits — sometimes immediately. A Special Needs Trust is the legal tool designed to solve that problem. It allows you to provide financial support for your loved one without jeopardizing the government benefits they depend on.
At Fulkerson Estate Planning & Elder Law LLC, we draft Special Needs Trusts for families across Liberty, the Kansas City Northland, and surrounding Missouri and Kansas communities. We work with both families planning ahead and individuals who need a trust established after an unexpected inheritance or legal settlement.
The Two Types of SNTs
Not all Special Needs Trusts are the same. The type of trust you need depends on whose money is funding it.
Third-Party Special Needs Trust. A third-party SNT is funded with assets belonging to someone other than the beneficiary — most commonly parents, grandparents, or other family members. This is the most common planning tool for families who want to leave an inheritance for a child or grandchild with a disability without disqualifying them from SSI or Medicaid.
A third-party SNT can be established during your lifetime as a standalone trust, or it can be created within your will or revocable living trust to take effect at your death. Either way, assets you contribute to the trust are not considered resources belonging to the beneficiary for purposes of SSI and Medicaid eligibility.
One important advantage of a third-party SNT: when the beneficiary dies, any remaining assets in the trust pass to whoever you designate — family members, charities, or other beneficiaries. The government does not have a claim on what remains.
First-Party Special Needs Trust. A first-party SNT — also called a self-settled trust — is funded with assets belonging to the person with the disability. This situation arises most commonly when someone who is already receiving SSI or Medicaid inherits money, receives a personal injury settlement, or otherwise comes into assets in their own name.
Without a first-party SNT, those assets would count as resources for SSI and Medicaid purposes, potentially ending eligibility until the assets are spent down. A properly structured first-party SNT allows the assets to be held in trust for the beneficiary's supplemental needs without disqualifying them from benefits.
There is an important distinction from a third-party trust: a first-party SNT must include a Medicaid payback provision, meaning that when the beneficiary dies, the state has a claim against remaining trust assets for Medicaid benefits paid during the beneficiary's lifetime. What remains after that payback, if anything, can pass to other beneficiaries.
What an SNT Can Do
A Special Needs Trust is designed to supplement — not replace — the government benefits the beneficiary receives. SSI and Medicaid cover basic needs: food, shelter, and medical care. An SNT can pay for the many things those programs do not cover, enhancing the beneficiary's quality of life without affecting their eligibility.
Common uses for SNT funds include:
Education and vocational training
Transportation and vehicle expenses
Technology, computers, and communication devices
Recreation, entertainment, and travel
Personal care items beyond what Medicaid covers
Therapeutic services not covered by insurance
Clothing and personal belongings
Legal and financial planning services
What an SNT generally cannot pay for — without affecting benefits — are items that SSI considers basic support, such as food and housing costs. The rules governing SNT distributions are specific and require careful attention. We explain these rules clearly so trustees understand what they can and cannot do.
How We Help
Drafting the Trust
We prepare SNTs tailored to your family's situation — whether that is a standalone third-party trust, a testamentary trust within your estate plan, or a first-party trust following an inheritance or settlement. Every trust is drafted to comply with current SSI and Medicaid rules in Missouri and Kansas.
Coordinating with Your Estate Plan
A Special Needs Trust does not stand alone. It needs to work with your will or revocable trust, your beneficiary designations, and the plans of other family members who may want to leave something for your loved one. We make sure everything fits together.
Educating the Trustee
The person managing an SNT carries real responsibility. We take the time to explain the trustee's duties, the distribution rules, and the recordkeeping requirements so the trust is administered correctly from the start.
First-Party Trust Situations
When someone on public benefits receives an unexpected inheritance or settlement, timing matters. Assets that land in an individual's hands can affect benefits immediately. We help families navigate these situations efficiently and structure a first-party SNT that protects ongoing eligibility.
Referrals When Needed
When a pooled trust is a better fit for a client's situation — particularly for smaller trust amounts — we will say so and help connect the family with appropriate resources.
Ready to Get Started?
Planning for a loved one with a disability requires getting the details right. We are here to help you put the right structure in place — one that protects benefits, provides for your loved one, and gives your family peace of mind.