Special Needs Trust

Special Needs Trust Attorney in Colorado Springs

Disability Estate Planning for Colorado Springs Families

A special needs trust can help preserve your loved one’s access to Medicaid and Supplemental Security Income (SSI) while still allowing your family to provide financial support. In Colorado, transferring assets or leaving money directly to a person with a disability can reduce or eliminate their eligibility for these programs. A properly drafted trust holds those assets separately, supporting benefit eligibility and covering supplemental needs that government programs don’t address. Getting the structure right from the start matters: drafting errors can affect a beneficiary’s benefits entirely.

At Drexler Law, we handle both estate planning and family law for Colorado Springs families, including those navigating disability planning. Our team includes a dedicated probate attorney and attorneys with experience across trusts, guardianship, and family matters. For parents managing a child’s disability plan alongside divorce or custody issues, working with one legal team that understands both sides can make a meaningful difference.

If your family is ready to explore special needs trust planning in Colorado Springs, call us at (719) 259-0050 to schedule a consultation.

Why Colorado Springs Families Work with Drexler Law

Our team brings over 100 years of combined legal experience to every client matter. That depth allows us to approach disability estate planning not as an isolated task but as part of a family’s broader legal picture. We tailor every plan to the beneficiary’s specific care needs, income sources, and long-term goals rather than applying a one-size-fits-all approach.

Our attorneys have earned consistent recognition for both legal quality and client service. Matthew Drexler holds the AV Preeminent rating from Martindale-Hubbell (5.0/5.0) and was named to the Top One Percent by the National Association of Distinguished Counsel from 2015 through 2019. Teresa Drexler holds the Martindale-Hubbell Silver Client Champion designation for 2026 and received Avvo Client’s Choice recognition in 2014, 2015, and 2018. Multiple attorneys on our team carry 10.0 Superb Avvo Ratings.

We’ve served the Colorado Springs community, including military families at nearby installations, since our founding in 2014. Clients consistently describe our approach as treating them like family, with clear communication at every step and no surprises along the way.

Start Planning for Your Loved One’s Future

The right time to set up a special needs trust is before it’s urgently needed. Whether you’re doing long-term planning for a child with a disability or responding to a recent inheritance or settlement, our Colorado Springs attorneys can walk you through your options and help you build a plan that can hold up over time.

Contact Drexler Law at (719) 259-0050 or reach us through our online contact form to schedule your consultation.

Types of Special Needs Trusts in Colorado

Colorado families have three main trust structures to consider. Each serves a different situation, and choosing the wrong one can affect SSI, Medicaid, Section 8 housing, and other public assistance programs.

First-Party Special Needs Trust

A first-party trust is funded with the beneficiary’s own assets, such as a personal injury settlement, an inheritance received directly, or savings. These trusts must be irrevocable under federal law. One important consequence: after the beneficiary’s death, any remaining funds are subject to a Medicaid payback requirement. Colorado’s Medicaid program typically must be reimbursed for benefits paid during the beneficiary’s lifetime before any assets pass to others. First-party trusts may also need to be submitted to the Colorado Department of Health Care Policy and Financing (HCPF) for review as part of the Medicaid eligibility determination process. An attorney can confirm whether the trust document meets all required provisions before submission.

Third-Party Special Needs Trust

A third-party trust is established and funded by someone other than the beneficiary, most often a parent or family member doing advance planning. This is the most common structure for families engaged in long-term estate planning. Third-party trusts don’t carry a Medicaid payback requirement, so assets remaining after the beneficiary’s death can pass to other named beneficiaries rather than being claimed by the state.

Pooled Trust

A pooled trust is administered by a nonprofit organization. Multiple beneficiaries combine assets into a larger investment pool while each maintains a separate sub-account. This structure can be practical when the amount of trust assets doesn’t justify the administrative cost of a standalone trust. Whether a Medicaid payback requirement applies depends on how the pooled trust is structured.

ABLE Accounts as a Companion Tool

An ABLE account functions more like a savings account for qualified disability expenses. It can work alongside a special needs trust, but carries annual contribution limits that a trust doesn’t. For families doing comprehensive planning, understanding how both tools interact is part of building a complete strategy.

The Special Needs Trust Setup Process

Setting up a trust involves more than signing a document. Each stage has decisions that affect how well the trust supports your loved one’s benefits over time. We start by understanding the beneficiary’s current benefit eligibility, care needs, income sources, and your family’s long-term goals. That assessment shapes which trust structure fits the situation.

Drafting the Trust Document
The trust document must be drafted carefully to satisfy SSI and Medicaid rules. The beneficiary can’t have direct access to trust funds; the trustee controls all distributions. That structure is a requirement, not a formality, for maintaining benefit eligibility.

Funding the Trust
A trust that isn’t properly funded doesn’t help anyone. Funding involves formally transferring assets into the trust, and the process varies depending on the asset type and trust structure.

Ongoing Administration
Distributions must be managed carefully after the trust is created. Some expenditures, particularly housing costs, are treated as in-kind support under SSI rules and can reduce the beneficiary’s monthly benefit amount. Common administration mistakes include naming an unqualified trustee, mishandling distributions, and failing to update the trust as the beneficiary’s circumstances change.

Families often consider naming a professional trustee or co-trustee alongside a family member. Professional trustees carry specific fiduciary obligations and bring experience managing distributions under benefit program rules, which can reduce the risk of well-intentioned decisions that inadvertently affect eligibility.

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