The prevalence of opioid addiction in Louisiana and throughout America rightly concerns people who intend to bequeath an inheritance to someone troubled by serious substance abuse. A benefactor worried that money given to an heir addicted to narcotics will encourage drug buying can explore the potential of setting up an incentive trust.
The terms of an incentive trust tackle the issue head on. This estate planning tool will deny funds to someone who has not provided evidence of reform. The trust could fund rehabilitation as long as the person demonstrates a willingness to follow a drug treatment program. Requirements imposed by a trust could include routine drug tests, employment and substance abuse counseling. Compliance would enable distributions of funds. Failure to meet requirements would prevent distributions.
A trustee managing an incentive trust for an addict might need access to the beneficiary’s medical records. To view private medical information, a trustee must have a valid Health Insurance Portability and Accountability Act waiver. For an incentive trust to serve its purpose, the benefactor must choose a trustee capable of enforcing the terms of the trust.
A family might also choose this type of financial tool to control spending on the care of an addict. Drug habits can easily cost thousands or hundreds of thousands of dollars. By placing assets in an incentive trust, a family could keep strings attached to money and potentially limit the impact on the family’s future financial plans.
Because an incentive trust might invite legal challenges from a beneficiary determined to access funds, the services of an attorney knowledgeable about estate planning might help the benefactor develop language that thoroughly outlines incentives and prohibitions. An attorney could research legal angles carefully and strive to write terms that protect assets and the well-being of the beneficiary.