Future.

Caring for a loved one with a disability comes with important financial decisions. While you want to provide for their future, if you give them money directly, you could put their Medicaid or Supplemental Security Income (SSI) at risk. A Special Needs Trust (SNT) helps solve this problem. An SNT allows you to set aside funds for their care without affecting their ability to receive government assistance.

What Is a Special Needs Trust?

An SNT is a legal arrangement that holds assets for a person with disabilities. Instead of giving money directly to the individual, you place the funds in a trust and let a trustee manage it. With an SNT in place, the money is used for approved expenses and the beneficiary is still eligible for government programs​.

Funds in the trust can be used for any of the following:

• Medical treatments and therapy
• Education and job training
• Personal care services
• Recreation and travel
• Specialized equipment and technology​

Types of Special Needs Trusts

Choosing the right type of trust depends on where the assets come from.

• Third-Party SNT: This trust is created by parents, grandparents, or other family members using their own money. Since the funds never belong to the beneficiary, Medicaid cannot claim them after their death​.
• First-Party SNT: This trust is funded with the beneficiary’s own assets, such as an inheritance or lawsuit settlement. It protects Medicaid eligibility but requires any remaining funds to reimburse Medicaid after the beneficiary passes away​.

Why a Special Needs Trust Is Important

A well-structured SNT provides long-term financial security. Without one, an inheritance or large gift could make the beneficiary ineligible for Medicaid and SSI. Once that money runs out, they may have trouble requalifying for benefits​.

An SNT also protects the beneficiary from mismanaging funds. A trustee oversees spending, ensuring the money is used wisely. This prevents financial abuse or unintentional misuse that could leave the individual without resources​.

Secure Your Loved One’s Future

A Special Needs Trust helps you provide financial support while protecting government benefits. It ensures your loved one has access to medical care, personal services, and quality-of-life improvements. Contact O’Brien Law Firm, LLC, in Southaven, MS, today to learn how an SNT can fit into your estate plan.

Farming and fishing are unpredictable industries. Some of the things that can leave business owners struggling to pay their debts include bad weather, market fluctuations, and rising costs. When financial trouble hits, family farmers and commercial fishermen can use Chapter 12 bankruptcy to restructure their debt while keeping their businesses running.

What Is Chapter 12 Bankruptcy?

Chapter 12 is a special type of bankruptcy designed specifically for farmers and fishermen. Unlike Chapter 7, which requires selling assets to pay creditors, Chapter 12 lets debtors create a repayment plan while continuing operations​. This plan typically lasts three to five years and allows farmers and fishermen to repay their debts based on seasonal income​.

Who Qualifies for Chapter 12?

To file for Chapter 12, you must meet the following criteria:

• Be a farmer or fisherman with regular annual income.
• Meet debt limits. Farmers must owe less than $11,097,350, and fishermen must owe less than $2,268,550​.
• Have at least 50% of debts (farmers) or 80% (fishermen) related to business operations​.

Benefits of Chapter 12

• Stops creditor harassment: As soon as you file, lenders must stop collection attempts, repossessions, and foreclosures​.
• Restructures debt: The “cramdown” provision allows you to reduce secured debt to the market value of your assets. If your equipment loan is more than what the equipment is worth, Chapter 12 can lower what you owe​.
• More flexible payments: Unlike Chapter 11 or 13, Chapter 12 recognizes that farmers and fishermen earn money seasonally. The court considers this when approving a repayment plan​.
• Debt forgiveness: Once the repayment plan is complete, some remaining debts may be discharged​.

Things to Consider Before Filing

Chapter 12 works best for those who want to keep their business running while paying off debt. However, there are a few things to keep in mind:

• You must show a stable income, even if it fluctuates throughout the year​.
• A court-appointed trustee will oversee payments to creditors​.
• Certain debts, like child support and some taxes, cannot be erased​.

If debt is threatening your farm or fishing business, Chapter 12 may offer a way forward. It provides protection from creditors and gives you time to repay what you owe. Contact O’Brien Law Firm, LLC, in Southaven, MS, today to discuss your options and get the legal guidance you need.