[co-author: Melissa Hoffmann]

Governor Andrew Cuomo recently signed legislation which amends New York law to allow mentally-competent disabled individuals under age 65 to establish a first-party Special Needs Trust without court petition.

In the past, when an individual with special needs had assets in his or her name which precluded his or her eligibility for government benefits, a special needs trust could only be created to achieve eligibility for benefits while preserving the assets for a disabled individual’s care by a parent, a grandparent or a legal guardian, or by the disabled individual by way of a lengthy and costly court proceeding.  Now, a disabled individual with mental capacity can establish his or her own special needs trust for assets in his or her own name without the involvement of these other individuals, or the courts, while preserving his or her eligibility for government benefits (for example, Medicaid and SSI).

New York Social Services Law 366(2)(b)(2)(iii) now conforms to the Federal Special Needs Trust Fairness Act signed into law by President Barack Obama on December 13, 2016, and applies to all first-party Special Needs Trusts established in New York on or after August 21, 2017.