Planning for Beneficiaries with Special Needs in Madison, Wisconsin
Special Needs Trusts & Wispact Trusts
Planning for the future of a loved one with a disability can feel overwhelming. You want to provide for them without putting essential benefits at risk. A Special Needs Trust (SNT)—including those offered through Wispact, Inc.—can offer peace of mind and long-term financial protection.
What is a Special Needs Trust?
A Special Needs Trust is a legal tool that allows money to be set aside for a person with a disability without affecting their eligibility for important public benefits like SSI (Supplemental Security Income), Medicaid, and Family Care.
There are two main types:
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First-Party SNT – funded with the beneficiary’s own assets (e.g., a personal injury settlement or inheritance).
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Third-Party SNT – funded with assets from someone else (like a parent or grandparent) as part of an estate plan.
These trusts are carefully structured to supplement—not replace—government benefits. Funds can be used for housing, transportation, education, therapies, personal care, and other quality-of-life needs.
What is a Wispact Trust?
Wispact, Inc. is a Wisconsin nonprofit organization that administers pooled special needs trusts. Wispact Trusts are a popular option for families and individuals who want the benefits of an SNT with lower setup and administration costs.
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Wispact offers two types of pooled trusts:
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Wispact Self-Funded Trust – for individuals of any age.
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Wispact Third-Party Trust – for individuals under age 65.
Benefits of using a Wispact Trust include:
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Professional trust administration
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Simplified reporting and compliance
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Low minimum funding requirements
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Access to experienced case advisors
What is a Wispact Self-Funded Trust?
To qualify for a Wispact Self-Funded Trust, the person the trust is for—the beneficiary—must meet the Social Security definition of having a disability. Any money spent from the trust must be used only for their benefit, and how those funds can be used may depend on what public benefits the beneficiary is receiving.
A Self-Funded Special Needs Trust can be set up by the beneficiary themselves, or by a parent, grandparent, guardian, or a court. These trusts can be created for someone over the age of 65.
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The trust is funded with the beneficiary’s own money—often from things like a personal injury settlement, divorce settlement, the sale of a home, or an inheritance that was left directly to them. Setting up or funding this type of trust frequently requires court involvement, especially when the beneficiary is receiving government benefits.
What is a Wispact Third-Party Trust?
A Third-Party Special Needs Trust is designed for someone who has a disability as defined by Social Security, and it can be set up for people of any age. While the money in the trust must be used only to benefit the person with the disability, there’s generally more flexibility in how those funds can be used.
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This type of trust must be created by someone other than the beneficiary—such as a parent, grandparent, other relatives, friends, a legal guardian, or even the court. The person with the disability can’t create this trust for themselves under current law.
Third-party trusts are funded with assets that have never belonged to the beneficiary. Common examples include gifts from family members, money left in a will, or distributions from another trust set up as part of an estate plan.
Protect Your Loved One’s Future—Without Jeopardizing Benefits
A properly designed special needs trust ensures your loved one receives the care and support they need—while preserving eligibility for essential programs like SSI and Medicaid.
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At Underwood Legal, LLC, we help families create Wispact and custom special needs trusts with care, clarity, and legal precision.