Which type of trust is specifically created to provide for an individual while preserving his or her eligibility for government assistance programs?

A special needs trust is specifically designed to provide for individuals with disabilities while ensuring that they remain eligible for government assistance programs, such as Medicaid and Supplemental Security Income (SSI). This type of trust allows the individual to receive additional financial support and resources without disqualifying them from these crucial benefits.

The assets held in a special needs trust are not considered countable resources for government benefit eligibility, thus preventing the loss of essential services that are often vital for individuals with disabilities. This is achieved by structuring the trust in such a way that the funds are used for supplemental care, covering expenses not provided by public assistance, without affecting the individual’s financial standing as recognized by the governing bodies overseeing these programs.

In contrast, other types of trusts, such as revocable trusts or testamentary trusts, do not have the same provisions to protect government benefits, as they may count as assets against eligibility thresholds. A charitable trust is focused on benefitting a charitable purpose rather than supporting an individual’s needs in the context of government assistance.