Learn the Differences between the Third Party Supplemental Needs Trust and the First Party or (d)(4)(a) Special Needs Trust and How We Use Them
A third party SNT is funded with assets that are owned by parents, relatives or friends, but not assets owned by the trust beneficiary. Third party SNTs are an ideal estate planning vehicle for parents and other friends and relatives who want to leave an inheritance to an individual with disabilities. Parents frequently say that their greatest worry is how their child with disabilities will fare once they have passed away. Not only will a third party SNT shelter an intended inheritance, it can be used during the parents’ lifetimes for ongoing expenses that are not covered by government entitlements.
A significant attraction of the third party SNT is that, unlike a first party SNT, when the beneficiary dies, there is no Medicaid payback requirement. The person who created the third party SNT (often a parent) chooses and has complete control over selection of the trust remainder beneficiaries.