ESTATE PLANNING

LAST WILL & TESTAMENT

Without a will, your property will be divided according to state law, which applies the same rules to everyone. A will gives you the ability to decide what happens to your estate.

With a will, you can:

  • Define your assets and name beneficiaries;

  • Appoint guardians for minor children;

  • Provide funeral or memorial instructions;

  • Ensure pets are cared for; and

  • Appoint an executor to carry out your wishes.

A will is an important tool, but it must go through probate, which is the court process that oversees the administration of your estate.

LIVING TRUST

A living trust is a legal arrangement that holds title to your property and is managed by a trustee. While you are alive, you may serve as your own trustee, or you may appoint someone else.

Living trusts have several important advantages:

  • They avoid probate, allowing faster distribution of assets;

  • They are private documents, not public records like wills;

  • They allow your chosen trustee to manage assets if you become disabled; and

  • They can provide immediate funds for minors, disabled family members, or death expenses without waiting on court approval.

With a properly funded living trust, you can make things easier for your loved ones while maintaining flexibility and control during your lifetime.

SPECIAL NEEDS TRUST

A Special Needs Trust (SNT) is designed to protect a person with a disability who receives (or may receive) needs-based benefits like SSI or Medicaid. Without an SNT, even a modest inheritance or settlement could disqualify someone from benefits they depend on.

First-Party Special Needs Trusts

  • Funded with the disabled person’s own assets, commonly from a personal injury settlement, back pay, or inheritance paid directly to them.

  • Preserves eligibility for Medicaid and SSI by keeping the assets out of the beneficiary’s “countable resources.”

  • Required by law to include a Medicaid payback clause - any funds left at the beneficiary’s death must first reimburse Medicaid for services provided.

  • Often requires court approval in Arkansas when funded with settlement proceeds for minors or incapacitated adults.

Third-Party Special Needs Trusts

  • Funded with assets belonging to someone other than the person with the disability, such as a parent, grandparent, or other family member.

  • Commonly used in estate planning to provide for a disabled child or relative.

  • Unlike first-party trusts, no Medicaid payback is required. When the beneficiary passes away, any remaining funds can go to other family members or charities.

Why These Trusts Matter

Special Needs Trusts ensure that:

  • Your loved one can keep critical benefits like SSI and Medicaid.

  • Funds can still be used to improve quality of life (education, therapies, equipment, travel, hobbies, and more).

  • Assets are protected from creditors and lawsuits.