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Special Needs Trusts
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Flashcards
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Life Insurance Trust
A trust specifically designed to hold a life insurance policy, which can help manage estate taxes and ensure the policy benefits are used as intended.
Medicaid Asset Protection Trust
A type of irrevocable trust that enables individuals to qualify for Medicaid by holding their assets outside of their countable estates.
Charitable Remainder Trust
A trust that provides income to the grantor and then donates the remainder to charity. Used in elder law for tax benefits and philanthropy.
Income-Only Trust
A type of irrevocable trust where the grantor is only entitled to the income generated by the trust assets, which can protect the principal for Medicaid planning.
Irrevocable Trust
A trust that cannot be modified or terminated without the permission of the beneficiary. Used in elder law to protect assets from being counted for Medicaid eligibility.
Grantor Retained Annuity Trust
A financial instrument that allows a grantor to contribute assets to a trust and receive annual payments for a set period, with the remaining assets going to beneficiaries.
Qualified Terminable Interest Property Trust
Allows a grantor to provide for a surviving spouse and also maintain control over the trust's assets after the spouse's death, which can be important for blended families.
Revocable Living Trust
A trust that can be altered or dissolved by the grantor during their lifetime. It is often used in elder law for estate planning and to avoid probate.
Special Needs Trust
A trust designed to benefit an individual with disabilities without disqualifying them from government assistance programs like Medicaid or SSI.
Testamentary Trust
A trust that is created upon the death of an individual, as dictated by their will. It can provide for minors or individuals with special needs.
Veterans Asset Protection Trust
Designed for veterans, this trust helps protect assets and qualify for certain VA benefits, similar to Medicaid asset protection trusts.
Pooled Trust
A trust run by a nonprofit organization that pools and manages funds from multiple beneficiaries with special needs, providing benefits without disqualifying them from government aid.
Qualified Income Trust
Also known as a Miller Trust, it is used to help individuals with too much income qualify for Medicaid by directing income into the trust.
Spendthrift Trust
A trust that provides a beneficiary with income while protecting the trust's principal from the beneficiary's creditors and/or poor spending habits.
Discretionary Trust
A trust where the trustee has full discretion on when and what payments to make to beneficiaries, often used to protect beneficiaries from poor financial decisions.
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