Special Needs Trust

• A Connecticut special needs trust is specifically for a mentally or physically disabled person who receives state or federal benefits for care and maintenance. The beneficiaries of Connecticut special needs trusts receive state administered Medicaid benefits and usually live in an assisted living facility or nursing home. Connecticut limits the amount of funds a person can have and still qualify for assistance, and the special needs trust design is to assist with supplemental needs the person may have without disqualifying state or federal assistance. Restrictions and limitations apply regarding the administration of special needs trusts
  
  

Revocable Trust

• A Connecticut revocable trust has no restrictions except for those placed in the trust agreement by the grantor of the trust. The grantor is the owner of the trust and can modify, amend or revoke the trust at any time. The owner of a grantor trust generally cannot qualify for state and federal benefits assistance, since trust assets create over-the-limit available resources that disqualify the grantor under the Connecticut code.
  
  

Comparison of Distributions

• The trustee limits distributions from a Connecticut special needs trust so as not to disqualify the beneficiary's benefits, which means the beneficiary cannot withdraw funds upon request. The grantor of a revocable trust in Connecticut or any jurisdiction has no limits regarding amounts of funds withdrawn, since the grantor is the owner of the trust.
  
  

Connecticut Specific

• State laws vary regarding administration of special needs trusts. Connecticut requires that the special needs trust be properly created and if not, the trust may disqualify the person for benefits. Medicaid qualification is required under Title 19 of the Social Security Act, and state statutes are specific as to what constitutes a proper special needs trust (see Resources). Since setting up a special needs trust is state specific, the advice of a Connecticut lawyer that practices in the field of special needs trusts is prudent.