What Can Special Needs Trust Fund Money Be Spent On?

An Arizona special needs trust is a special financial account set aside for individuals that are mentally ill or otherwise disabled and unable to manage their own interests. The monies in this account can be set aside for any number of reasons, which is a standard of this type of trust, whether it is an Arizona special needs trust or an account such as this in another state.

One of the key components of an Arizona special needs trust, or any trust of this nature, is that the monies must stay in the account. In other words, the beneficiary of this account cannot simply take the money out; otherwise it may affect their ability to continue to receive Medicaid (ALTCS) and Social Security Income (SSI). The administrator of the trust has to be a third-party individual; in other words, the beneficiary of the account cannot be the one in control of it.

The point of the trust is to have a special account that ensures the individual receives what they need for daily living and other expenses without affecting their ability to receive this critical income. It may also be to purchase extra items that may not be purchased with the SSI stipend the person receives monthly, which often isn’t enough to completely cover expenses and extras.

Special needs trust fund dollars can be spent on a vast array of purposes, from medical expenses not covered by insurance (including prescription costs), living expenses, vacations, furnishings and other decorative items for the home, insurance premium payments, home-based health care, personal items, rent or mortgage payments, clothing, food and anything else necessary for the beneficiary to be able to live. There are no restrictions on the way the money can be spent as long as it not removed from the trust and handed off to the person directly.

An Arizona special needs trust and other accounts like it ensure that the person benefiting from it are covered for as long as the money lasts in the trust or until the beneficiary of the account passes away, which ever comes first.

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