Planning for the long-term care of a loved one with a disability is one of the most important—and complex—tasks a family can undertake. In New Hampshire, families often face a difficult dilemma: how to provide financial support for a disabled family member without accidentally disqualifying them from essential government benefits like Supplemental Security Income (SSI) and Medicaid.

At Russman & Phinney Law, we specialize in helping families navigate these complexities through the creation of Special Needs Trusts (SNTs). The purpose of a special needs trust is to provide extra support and comfort for the beneficiary without jeopardizing important public assistance benefits.

What is a Special Needs Trust?

A Special Needs Trust (sometimes called a "Supplemental Needs Trust") is a specialized legal arrangement where a trustee holds and manages assets for a beneficiary with a physical or mental disability.

Because the beneficiary does not legally "own" the assets within the trust, the funds are not counted toward the strict asset limits imposed by government programs. This allows the trust to pay for "supplemental" needs, things that public benefits do not cover—such as:

• Specialized medical equipment or dental care.
• Physical therapy and support services.
• Education and vocational training.
• Travel and recreation.
• Electronics and home modifications.
• Basic comforts that improve overall quality of life.

Types of Special Needs Trusts in New Hampshire

Understanding which type of trust fits your situation is critical. In New Hampshire, there are two primary categories:

1. Third-Party Special Needs Trusts

This is the most common tool for estate planning. It is established and funded by someone other than the beneficiary (usually a parent or grandparent).

• Benefits: There is no "Medicaid Payback" requirement. When the beneficiary passes away, the remaining assets can be distributed to other family members or charities.
• Usage: Often included in a will or a broader comprehensive trust plan.

2. First-Party (Self-Settled) Special Needs Trusts

This trust is funded with the beneficiary's own money—perhaps from a personal injury settlement, an inheritance, or accumulated savings.

• Requirements: Under federal and NH law, the beneficiary must be under age 65 when the trust is established.
• The Payback Rule: Unlike third-party trusts, a first-party Special Needs Trust must include a provision stating that upon the beneficiary's death, the state (New Hampshire DHHS) must be reimbursed for any Medicaid expenses paid on behalf of the individual.

Why You Need an Experienced New Hampshire Estate Planning Attorney

The rules governing Special Needs Trusts are notoriously strict. A single mistake in the language of the trust or the way a trustee distributes funds can result in a total loss of benefits for the disabled individual.

Proper Drafting

The trust must be "irrevocable" and the beneficiary must not have the power to demand distributions. In New Hampshire, specific language is required to satisfy both the Social Security Administration (SSA) and the Department of Health and Human Services (DHHS).

Trustee Guidance

Choosing a trustee is a significant decision. The trustee must understand the "sole benefit" rule and the complex reporting requirements. At Russman & Phinney Law, we don't just draft the documents; we advise families on how to manage the trust effectively over the long term.

Integration with Your Total Plan

A Special Needs Trust should not exist in a vacuum. It must be integrated with your larger estate plan, including your Will, Powers of Attorney, and other types of trusts to ensure your entire family is protected.

Protect Your Loved One's Quality of Life

If you are caring for a child or adult with special needs in New Hampshire, don't leave their future to chance. At Russman & Phinney Law, we have the experience and local knowledge necessary to protect your family's assets and your loved one's peace of mind.

Contact Russman & Phinney Law today to schedule a consultation and learn how we can help you build a secure future through a Special Needs Trust.