[WSBAPT] Special Needs Trust question

[Marcus Fry]

Medicaid recipient can have rent free housing, including a trust that owns a residence.  However, if the recipient is also receiving SSI, then if the recipient receives rent free housing the recipient could lose benefits.  However, if the recipient is the beneficiary of the trust, SSA rules treat the recipient as possessing an equitable home ownership interest, and therefore, receiving free rent will not jeopardize SSI benefits.  However, if the trust pays for other shelter expenses (real estate taxes) and household operating expenses (utilities), these payments would be income in the form of in-kind support and maintenance.

Marcus J. Fry
Lyon, Weigand & Gustafson, P.S.
Adoption Attorney*
P.O. Box 1689
Yakima, Washington  98907
Telephone:  (509) 248-7220
Facsimile:  (509) 575-1883

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From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Eric Nelsen
Sent: Thursday, March 03, 2016 12:32 PM
To: WSBA Probate & Trust listserve (wsbapt at lists.wsbarppt.com)
Subject: [WSBAPT] Special Needs Trust question

Disabled adult child (50 years old) is inheriting a one quarter share of parent's estate. The parent is deceased, no will, so we are working toward getting a special needs trust set up for the disabled child's distribution.

The family's desire is to keep the family house that the disabled child has lived in continuously since birth; but, we do not have sufficient assets to do non pro rata distributions and avoid putting real estate in the special needs trust.

Can a special needs trust retain a real property interest, and allow the beneficiary to live at that property rent-free, without violating the need-based requirements for government assistance?

Sincerely,

Eric

Eric C. Nelsen
SAYRE LAW OFFICES, PLLC
1320 University St
Seattle WA  98101-2837
phone 206-625-0092
fax 206-625-9040

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