Special Needs Trusts

What is a special needs trust?

A special needs trust is created by a family member or other person for the benefit of a disabled person (the beneficiary) using the disabled person’s money or money he or she will receive.

Why would you need a special needs trust?

These trusts are usually set up when a disabled person gets money from a lawsuit, settlement, an estate, or insurance policy.

Can you still get government benefits with a special needs trust?

Yes. A special needs trust is usually created to keep the disabled person eligible for government benefits. Upon the death of the disabled individual, the trust must reimburse Medicaid for benefits paid on behalf of the disabled person before the trust can be disbursed to any other surviving beneficiaries or heirs.

Special Needs Trusts PDF

Acknowledgements & Disclaimer: This Fact Sheet was prepared by West Tennessee Legal Services (WTLS) and made possible by Serving Tennessee Seniors-administered by The Community Foundation of Middle Tennessee at the request of the Chancery Court. WTLS thanks the Tennessee Bar Association for its permission to use The Legal Handbook for Tennessee Seniors (2014 edition) as a primary information source. This publication is supported, in part, by funds provided by the Southwest Area Agency on Aging and Disability, the Tennessee Commission on Aging and Disability, and the U.S. Department of Health and Human Services. The content herein does not necessarily reflect the opinion or policy of the Southwest Area Agency on Aging and Disability or any agency of Tennessee or the U.S. government. Fact Sheets are for information only and not intended to replace legal advice. If you are in need of legal help, call WTLS at (800) 372-8346, or seek the help of a private attorney. (Revised 5/2017)