Planning for the future of a loved one with special needs requires careful thought. Families in Sevierville, Gatlinburg, Pigeon Forge, Nashville and across East and Middle Tennessee often worry about how to provide financial support without jeopardizing eligibility for important government benefits. A special needs trust is one of the most effective tools to protect your loved one’s quality of life while preserving access to programs like Supplemental Security Income (SSI) and Medicaid.
What Is a Special Needs Trust?
A special needs trust is a legal arrangement that holds assets for the benefit of an individual with disabilities. Instead of giving money or property directly to the person, assets are placed in the trust and managed by a trustee. This structure ensures that funds are available to enhance the beneficiary’s life without disqualifying them from income-based benefits.
Why Families Use Them
Government programs are often the foundation of support for individuals with special needs, but they come with strict financial limits. Receiving even a modest inheritance directly could cause a person to lose benefits. By using a special needs trust, families can provide supplemental resources—such as funds for therapies, education, transportation, vacations, or personal items—while keeping benefits intact.
Types of Special Needs Trusts
There are two primary types of special needs trusts in Tennessee:
- First-Party Trusts: Funded with the disabled individual’s own assets, such as an inheritance or personal injury settlement. These must include a “Medicaid payback” provision requiring that any remaining assets be used to reimburse Medicaid after the individual’s death.
- Third-Party Trusts: Funded with assets from parents, grandparents, or others. These do not require Medicaid reimbursement and are often used in estate planning to leave an inheritance for a loved one with special needs.
How Champagne Law Firm Can Help
At Champagne Law Firm, with offices in Sevierville, Nashville, and Rogersville, we guide families through the process of setting up special needs trusts tailored to their circumstances. Our attorneys explain how these trusts work, draft clear and enforceable documents, and coordinate with financial and care planning professionals to ensure long-term stability. We understand that this isn’t just about legal documents—it’s about protecting your loved one’s dignity and future.
Taking the Next Step
Special needs trusts provide peace of mind, knowing that your loved one will have the support they need without the risk of losing critical benefits. By putting the right structure in place, you can safeguard both financial resources and the well-being of someone you care deeply about.
Call Champagne Law Firm at 865-228-8080 or reach out online to schedule a consultation about special needs trusts in Tennessee.
