What Can a Supplemental Needs Trust Be Used for in Virginia?

A supplemental needs trust can help preserve a beneficiary’s eligibility for government-based assistance programs while also allowing the beneficiary to receive gifts or an inheritance that can make a significant difference in his or her life.

At Golightly Mulligan & Morgan, we can provide customized legal solutions that allow you to help a disabled loved one without affecting his or her continued eligibility for public benefits.

Eligibility for Government-Based Assistance Programs

In the special needs context, the two most commonly discussed programs include Supplemental Security Income (SSI) and Medicaid. These are both needs-based programs.

SSI is a federal program that provides food and shelter for our country’s population in need. Medicaid is a federal/state partnership that is designed to provide certain medical services for those in need.

To be eligible for these types of benefits, recipients must be able to demonstrate a lack of basic financial resources and must meet certain income and resource thresholds.

Social security requires SSI recipients to have less than $2,000 in countable assets for a single person, and $3,000 for a married couple. In general, the income limit for SSI is the Federal Benefit Rate, which is $750 per month for an individual and $1,125 per month for a married couple.

In order to participate in Medicaid, federal law requires states to cover certain groups of individuals including low income families, qualified pregnant women and children, and individuals receiving SSI. Income requirements for Medicaid in Virginia are determined through use of the Modified Adjusted Gross Income (MAGI) calculator. If you are a pregnant woman, the income limit is set at 143 percent of the federal poverty level in Virginia. If you are blind, aged, or disabled, you can earn no more than 80 percent of the federal poverty level to qualify for Medicaid.

When You Might Need a Supplemental Needs Trust

We often see the need for the preservation of these benefits if a child has a disability or condition that may ultimately result in his or her need for these benefits down the road.

It is important when putting together an estate plan that you do not cause him or her to be disqualified for these important benefits.

You need to understand that if a recipient receives assets outright from a trust or estate, he or she will likely be disqualified from receiving these benefits under the very stringent income and resource guidelines.

However, with a carefully drafted supplement needs trust, parents and grandparents can ensure that any inheritance will not interfere with the beneficiary’s eligibility for these benefits.

How a Supplemental Needs Trust Can Be Used

The trust funds should be used on supplemental items that are not covered by the beneficiary’s public benefits.

For example, the trustee can spend money on behalf of the beneficiary for vacations and leisure activities but not for things like rent, groceries and similar necessities for which the benefits are provided.

A well-drafted supplemental needs trust will provide detailed instructions and will allow the trustee to amend the trust to ensure continued eligibility for these programs.

Requirements of Supplemental Needs Trusts

One of the key requirements of a special needs trust is that money from the trust must be used to supplement and cannot overlap with current benefits being provided to the recipient for programs such as SSI or Medicaid.

Additionally, a trustee must be appointed to administer supplemental needs trusts. He or she serves as an intermediary between the beneficiary and the trust assets. The trust instructs the trustee to make distribution of trust assets in a manner that does not affect the beneficiary’s eligibility for benefits.

Contact an Experienced Trust and Estate Planning Lawyer

If you would like to create a supplemental needs trust that protects your loved one’s continued eligibility for public benefits, a Virginia estate planning attorney at Golightly Mulligan & Morgan can help.

At Golightly Mulligan & Morgan, we pride ourselves on making estate planning approachable and understandable. We would be happy to discuss supplemental needs trusts further with you and to inform you whether this estate planning tool may be an effective part of your estate plan.

To learn more about these supplemental needs trusts, please give us a call at 804-658-3873 to set up a no-charge phone consultation.

Top 4 Reasons You Should Consider a Revocable Living Trust

A revocable living trust is an important estate planning tool that allows you to create clear instructions on how your property should be treated. We can explain estate planning basics, such as how this tool can be used as a part of your comprehensive estate plan.

Here are the reasons why you should consider a revocable living trust:

1. Avoid Probate in Virginia

Probate is a court-supervised process that formally qualifies a personal representative who helps wind up the estate of a person who is deceased.

There are many drawbacks of the probate process, including additional costs, taxes, fees, and delays. Many people are intimidated by this process. They also do not like the idea of their financial affairs being exposed to the public through a court administrative process that is triggered by the filing of a will with the probate court.

2. Plan for Incapacity

One of the most critical distinctions of a revocable trust vs will is that a will’s powers only exist if the person who prepared it passes away. It has no relevance if the person who writes it becomes incapacitated.

However, a trust allows for the immediate management of a person’s trust estate. The person who drafts the trust can manage his or her own trust assets anyway he or she wishes so long as this language is included in the trust.

If the person later becomes incapacitated, the successor trustee is authorized to take over the management of the trust assets and follow the instructions included in the trust in case the person passes away or becomes incapacitated. This provides for a seamless transition of trustee authority if the person who created the trust becomes incapacitated and needs someone to take over management of the trust assets.

3. Manage Out-of-State Property

If a Virginia resident owns real property somewhere outside of Virginia, the personal representative appointed to handle the Virginia probate case does not have legal authority with respect to that out-of-state property.

Instead, the personal representative is required to open an additional probate case in the state where the property is located. This ancillary probate proceeding adds additional costs, fees, and taxes.

4. Treat Your Provisions Like a Contract

A revocable living trust is a contract and governed by contract laws. A will is not a contract and is subject to the probate laws of the state where the person happened to be living at the time of his or her death. The probate laws of that other state may be significantly different than the state where the will was originally created.

For mobile clients who are considering moving to another state, a revocable living trust is usually a better bet because you can take it with you and be confident that your wishes will be carried out.

Contact an Experienced Trust and Estate Planning Lawyer

If you would like to create a trust that protects your family and your legacy, an attorney for wills and trusts at Golightly Mulligan & Morgan can help.

At Golightly Mulligan & Morgan, we listen carefully to our clients’ wishes and guide them through the laws that might impact these wishes. We take the information that we learn during confidential consultations to develop a customized estate plan geared to meet their needs.

In addition to preparing trusts, we also prepare wills and powers of attorney. We assist with all aspects of trust and estate planning and assist personal representatives with the probate process. If necessary, we can help clients have a guardian or conservator appointed if a loved one has become incapacitated.

If you would like more information on how to set up a living revocable trust, give us a call. We pride ourselves on making family estate planning approachable and understandable. We would love to have the opportunity to be of service to you and your family.

Revocable Trusts vs. Irrevocable Trusts

One of the most common questions we receive in our estate planning practice is, "What is the difference between a revocable trust and an irrevocable trust?"  In this blog, we will provide a brief overview of the key differences between these types of trusts and give a few examples on why estate planners use them.


A revocable trust is often also referred to as a "living trust."  Estate planning lawyers use revocable living trusts to avoid court supervised probate, which often allows for the efficient and expedient distribution of a decedent's property.  As its name implies, a revocable living trust is easy to amend or revoke.  Indeed, for all intents and purposes, assets owned by revocable living trust are handled much in the same way as assets owned by an individual.  For example, while the creator of the trust is still alive, these types of trusts do not file their own tax returns because income flows directly to the person who created the trust, often called the "grantor."


On the other hand, an irrevocable trust is often used by estate planning attorneys to allow clients to either remove assets from the client's estate for estate tax purposes, or to provide added asset protection features.  The primary concept behind an irrevocable trust is the fact that the person who set up a trust no longer has ownership and control over the assets placed inside the trust.  Because such a trust may only be changed under very limited circumstances, the person who created the trust may avoid or mitigate estate taxes otherwise due on those assets when he or she dies.  With the proper planning, a client may also be able to use an irrevocable asset protection trust to exempt trust assets from a tort creditor or in a bankruptcy proceeding.


Although irrevocable trusts have somewhat limited application these days due to the high estate tax exclusion (currently, estate taxes only hit individuals with more than $11,200,000), we do use these trusts for asset protection purposes.  Conversely, we use revocable living trusts in our practice quite a bit to allow clients to avoid the probate process.  You may read more about the probate process in our "what is probate" blog here on our website.


Thanks for taking the time to read this.  Let us know if there's anything we can do to assist you with your planning.  Email: info@golightlylaw.com or call at 804-658-3873.