Special Needs Trusts

1. Special Needs Trusts The Arc of Northern Virginia

2. What Is A Special Needs Trust? • This is a trust designed to provide benefit to and protect the assets of a person with a disability and still allow the individual to be qualified for and receive government benefits; especially Medicaid and SSI.

3. Why Do I Need A Special Needs Trust? • In the commonwealth of Virginia, many public services you or your loved one receive or one day will need are tied to Medicaid and Social Security Eligibility. • Medicaid and Social Security have limits on what you can earn each month and save in a savings or checking account. • If you go over these limits, services can stop.

4. Why the purpose of a Special Needs Trust? • Provides a management to meet the needs of the Beneficiary which may arise and cannot otherwise be met by the beneficiary's personal resources or benefits. • Promote the dignity, comfort and happiness by providing supplemental care, treatment not otherwise covered.

5. Who is Eligible For A Special Needs Trust? Anyone with a physical, mental or intellectual disability; as defined by the Social Security Act Elderly; Receiving Medicaid or Disability Income

6. Types of Special Needs Trusts Self-Funded Trusts D4 (a) - Private D4(c) - Pooled Third Party Trusts funded unfunded

7. Self-Funded Trusts – d 4 (a) • Established by the parent, guardian • Funded by the individual • For the sole benefit of the individual • Created by a private attorney or institution

8. Self-Funded Trusts – d 4 (c) • Established by the parent, guardian or the individual; • Funded by the individual • For the sole benefit of the individual • Established with a Pooled Trust Program by utilizing a Master Trust Document and Joinder Agreement

9. What Is A Pooled Special Needs Trust (a.k.a. d4c) • Managed by a Non – Profit organization • Funds from individual participants are pooled for fee and investment purposes • Fees are calculated based on the total amount of pooled funds

10. Self-Funded Trusts • Most Self-funded accounts are established due to: • A personal injury settlement • An inheritance • Any other money that threatens benefits

11. Self-Funded Trusts • Upon the beneficiary’s death; remaining funds in the account are subject to a Medicaid Payback Provision.

12. Third Party Trusts –Unfunded or Funded • May be setup by parents, grandparents, siblings, aunts and uncles or friends. • Used frequently to by parents to plan for the Future: • Set up as part of your estate planning process to protect assets and services that your loved one is receiving. • Avoid probate to have funds available immediately. • Ensure your loved one has a way to obtain the items, services or the extra’s you want to make sure they have. • These can be funded during your lifetime or left unfunded until your passing.

13. Third Party Trusts –Unfunded or Funded • May be established by a private attorney or institution. • May be established as part of a pooled trust program

14. Why Choose A Pooled Trust? Pooled trusts are administered by non-profit agencies - professional staff, greater sensitivity and individualized services. Pooled trusts offer professional investment management by a bank. There are no minimum or maximum funding requirements They are more affordable for families or individuals

15. What Can I Use The Trust For? • Dental Care Costs • Trips – visiting siblings; going to the beach • Renting a tux for a cousin’s wedding • Pre-need Expenses • Anything not covered by Medicaid or SSI

16. What Can The Trust Not Be Used For? • Recipients of SSI cannot use the trust to pay for food and shelter; including electricity, gas and water bills, property taxes, homeowners insurance and condo association fees. • For self Funded account holders, the trust cannot pay for burial or funeral expenses for the beneficiary once they pass away. • The Trust can not hold loans • The Trust can not pay cash to the beneficiary. • The trust cannot make gifts or use funds for anyone other than the beneficiary

17. How Do I Access the Funds Once they are in the Trust? • Easily. You complete a simple disbursement request form stating the purpose of the request, amount of the request and to whom to send the check. • In many cases, supporting documentation is needed, such as a receipt or bill. • Then send the request form to The Arc. • We understand that everyone is different and we can be creative in accessing funds in other ways as well; such as direct bills.

18. How Much Does it Cost? • The establishment fee for the Special Needs Trust with The Arc of Northern Virginia is $1050.00. • The annual fee for an unfunded account in $65.00 until the account becomes funded. • The Foundation of The Arc of Northern Virginia bills 75 basis points annually of the individuals account. (.0075%) (subject to change) • SunTrust Bank bills 90 basis points annually. (.0090%) (subject to change)

19. Why Choose The Arc of Northern Virginia? • The Arc of Northern Virginia has been a leading advocate for individuals and families with disabilities for 45 years. • We have the knowledge, expertise, and sensitivity to meet your needs. • Our pooled trust has been in existence for over 8 years. • To date, our trust currently manage over $3.2 million dollars with $2 million in future dollars • We have experts available with whom we consult about changes in regulations. • We bring you this service in partnership with SunTrust Bank, a leader in the financial services industry.

20. Why Do I Need To Plan? We are all fortunate to be here today… But what about tomorrow…