CEA Special Needs Trust Planning 5

Question 1

A grandparent wants to leave money to a grandchild with a developmental disability without jeopardizing government benefits. Which planning option is MOST appropriate?

Accepted Answer

Leave assets in a third-party Special Needs Trust

Answer

A third-party SNT allows the grandparent to leave assets that supplement the grandchild's government benefits without counting as the grandchild's own resources.

Question 2

What happens if a Special Needs Trust distributes funds for food and housing expenses in excess of SSI's one-third reduction rule?

Accepted Answer

The SSI benefit may be reduced up to the presumed maximum value amount

Answer

SSI can be reduced by up to the Presumed Maximum Value (PMV) when in-kind support and maintenance is provided, which equals one-third of the FBR plus $20.

Question 3

A beneficiary of a first-party SNT passes away with $150,000 remaining in the trust. The state Medicaid agency has a lien of $90,000. What happens to the remaining funds after the Medicaid payback?

Accepted Answer

The remaining $60,000 can be distributed to remainder beneficiaries named in the trust

Answer

After satisfying the Medicaid payback requirement, any remaining assets in a first-party SNT can be distributed to remainder beneficiaries named in the trust document.

Question 4

Which of the following is a common mistake in SNT drafting that could jeopardize government benefits eligibility?

Accepted Answer

Giving the beneficiary the right to demand distributions at will

Answer

If the beneficiary has a legal right to demand distributions, the trust assets may be counted as available resources, disqualifying them from SSI and Medicaid.

Question 5

Which professional credential is specifically associated with expertise in Special Needs Trust planning and disability financial planning?

Accepted Answer

Certified Special Needs Advisor (CSNA)

Answer

The Certified Special Needs Advisor (CSNA) designation indicates specialized training in financial planning for individuals with disabilities, including SNT planning.

(CEA) Certified Estate Advisor Practice Test

(CEA) Certified Estate Advisor Practice Test

CEA Special Needs Trust Planning 5