Few worries weigh heavier on a Miami family than “who will care for my child or sibling with a disability after I’m gone?” A special needs trust (SNT) is one of the most reliable tools Florida law offers to answer that question. Below are the questions we hear most often from families in Miami-Dade.
If I leave money directly to my disabled loved one, what happens?
This is the most common and most costly mistake. Means-tested benefits like Supplemental Security Income (SSI) and Florida Medicaid have strict asset limits. An outright inheritance can push your loved one over those limits and suspend the very benefits that pay for their housing, therapies, and medical care. A properly drafted special needs trust holds the assets for the beneficiary without the beneficiary owning them, so eligibility is preserved.
What is the difference between a first-party and third-party SNT?
A third-party SNT is funded with someone else’s money, typically a parent’s or grandparent’s, through their will or revocable trust under Florida’s trust code (Chapter 736). A first-party (self-settled) SNT is funded with the beneficiary’s own money, often a personal injury settlement or a direct inheritance they already received. The key practical difference: a first-party trust generally must include a Medicaid “payback” provision, while a third-party trust does not, so what remains can pass to other family members.
What can the trust actually pay for?
An SNT is meant to supplement, not replace, public benefits. In Miami that often means things benefits won’t cover: a specialized wheelchair-accessible van, a companion for an outing to Bayfront Park, dental work, education, electronics, or travel to visit family. The trustee should avoid giving cash directly to the beneficiary and should be careful with food and shelter payments, which can reduce SSI dollar for dollar.
Who should serve as trustee?
The trustee manages investments, keeps records, and makes distributions that protect eligibility, so this role demands both trustworthiness and benefits knowledge. Many Miami families name a reliable relative as trustee alongside a professional co-trustee, or use a pooled trust administered by a nonprofit. Florida law lets you build in flexibility so the trust can adapt as your loved one’s needs change over the decades.
How do I fund it?
You can fund a third-party SNT through your will, a revocable living trust, or by naming the trust as beneficiary of a life insurance policy or retirement account. Relatives in other states can be directed to leave their gifts to the same trust rather than to the beneficiary individually. Coordinating every gift through one trust prevents an accidental, eligibility-destroying inheritance.
Does Florida tax this trust?
Florida has no state estate tax and no state inheritance tax, so the planning focus here is benefits preservation and sound administration rather than state death taxes. That said, federal rules and Medicaid rules are detailed and unforgiving, which is why generic forms often fail.
The bottom line
A special needs trust lets you provide comfort, dignity, and care for your loved one without jeopardizing essential benefits. Because the rules around first-party trusts, payback provisions, and SSI shelter limits are technical, this is not a do-it-yourself project. Speak with a Florida estate planning attorney familiar with Miami-Dade benefits programs to design a trust tailored to your family’s circumstances.
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For more on our Florida practice, see our overview of estate planning in Palm Beach. Morgan Legal Group's affiliated New York office also handles .
