The Louisiana Special Needs Trust - and Forced Heirship

It's common these days for Louisiana families to want to leave assets to someone who has what is commonly referred to as "Special Needs."

People who have "Special Needs" are typically defined as someone who, as a result of a disability, is receiving some sort of federal or state government aid. In order to continue to receive these government benefits, it is often required that the recipient's assets be maintained under a certain amount or value.

When you leave assets to someone who is benefiting from certain kinds of federal or state aid due to a condition which renders them unable to care for themself, the inheritance can disqualify them from future benefits.

So, many people who wish to leave an inheritance to someone with "Special Needs," often uses their Will or Trust to leave the inheritance to a trust. Not any trust but a special type of trust that is commonly referred to as a Special Needs Trust.

The idea here is that if the trust can be used to replace the government benefits, then that trust may disqualify the recipient from receiving future government benefits. But if the trust is designed to supplement the public assistance, then the government benefits may be preserved. 

The continued access to the government programs may be necessary for the person to maintain a level of dignity and humane care.

Further, in Louisiana, residents must also be aware of Louisiana Forced Heirship laws when they are setting up their estate planning program. Louisiana forced heirship laws generally provide, in part, that if you have a child of any age that is incapacitated, then you cannot disinherit them. If you leave a forced heir's portion in a trust, you must meet the requirements of the "forced portion in trust" provisions.

You can refer to my book, "Estate Planning in Louisiana," if you want to know more. Or, you can call our office at 866-491-3884, to start a conversation about establishing and maintaining an estate legal program that protects what you have for yourself and your loved ones.