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Military Survivor Benefits can go to Special Needs Trust

12-21-2014 - The recently passed National Defense Authorization Act of 2015 includes a provision that will greatly help military families with special needs children. Up until now, a serviceman or woman could leave up to 55% of his/her Survivor Benefits Plan to a surviving spouse or child. However, the funds had to be left directly to the individual. Left to a disabled child, the very funds intended to help with the child's long-term financial needs could disqualify the child from receiving essential means-tested government benefits, such as Social Security Disability or Medicaid.

The new legislation allows a portion of Survivor Benefits Plan to be deferred and left for a disabled child in a Special Needs Trust to benefit the child, thus not jeopardizing his eligibility for SSI and Medicaid. Well done, Congress.

You can read the text of the legislation here - scroll down to page 264 for the section that concerns the new provision.

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