Special Needs Trusts vs. Miller Trusts: Which Do You Need for Medicaid Planning in Florida?

When you’re trying to help a family member with disabilities maintain their government benefits, the alphabet soup of trust options can feel overwhelming. Two terms you’ll hear frequently—Special Needs Trusts and Miller Trusts—sound similar but serve completely different purposes.

Choosing the wrong trust won’t just waste time and money. It could disqualify your loved one from critical benefits they need to survive.

The Fundamental Difference: Assets vs. Income

Before diving into specifics, understand this key distinction:

Special Needs Trusts protect assets (money, investments, property) while preserving eligibility for Medicaid and SSI.

Miller Trusts protect income (Social Security, pensions, disability payments) to help you qualify when monthly income exceeds Medicaid’s limit.

Think of it this way: If your loved one has too much money saved, you need a Special Needs Trust. If they earn too much money each month, you need a Miller Trust.

Many Florida families need both.

What is a Special Needs Trust?

A Special Needs Trust (SNT)—also called a Supplemental Needs Trust—holds assets for a person with disabilities without disqualifying them from means-tested government benefits like Medicaid and Supplemental Security Income (SSI).

How Special Needs Trusts Work

When properly structured, assets in an SNT don’t count toward Medicaid’s $2,000 asset limit or SSI’s resource restrictions. The trust pays for supplemental expenses that enhance quality of life beyond what government benefits provide.

What Special Needs Trust funds can pay for:

• Medical and dental care not covered by Medicaid
• Transportation and vehicle expenses
• Education and job training
• Entertainment, hobbies, and vacations
• Home furnishings and modifications
• Personal care attendants beyond what Medicaid covers
• Technology and communication devices
• Legal fees and trust administration

Types of Special Needs Trusts

Third-Party Special Needs Trusts — Funded by someone other than the beneficiary (typically parents or grandparents). When the beneficiary dies, remaining funds go to whoever the trust creator designates—NOT to the state Medicaid agency.

First-Party Special Needs Trusts — Funded with the beneficiary’s own money (like an inheritance or personal injury settlement). Must include “payback provisions” requiring any remaining funds at death to reimburse the state for Medicaid benefits received.

Pooled Special Needs Trusts — Managed by nonprofit organizations in Florida. Individual accounts are tracked separately, but funds are pooled for investment purposes. Available for beneficiaries of any age. Upon death, remaining funds either stay in the pool to help others or go to the state (depending on trust terms and Florida law).

Who Needs a Special Needs Trust?

Special Needs Trusts benefit:

• Parents planning to leave an inheritance to a child with disabilities
• Individuals with disabilities who receive money (settlement, inheritance, gift) that would disqualify them from benefits
• Families wanting to supplement government benefits with quality-of-life improvements
• Anyone needing to protect assets for a disabled family member long-term

What is a Miller Trust?

A Miller Trust—officially called a Qualified Income Trust (QIT)—is a specialized tool used in Florida and other “income cap states” to help people qualify for Medicaid when monthly income exceeds the state limit.

How Miller Trusts Work in Florida

Florida’s 2026 Medicaid income limit is $2,901 per month for individuals. If your gross monthly income is $2,902 or higher, you’re technically over the limit—even if nursing home costs are $13,000+ monthly and you can’t afford care.

A Miller Trust solves this problem:

1. You establish an irrevocable trust with yourself as beneficiary
2. Income exceeding the limit gets deposited directly into the trust
3. Medicaid counts only the income you receive directly (now under the limit)
4. Trust funds pay for specific allowable expenses

Miller Trust funds can only pay for:

• Your monthly personal needs allowance ($130 in Florida for nursing home residents)
• Your spouse’s Monthly Maintenance Needs Allowance (if applicable)
• Health insurance premiums
• Incurred medical expenses
• The nursing home

Who Needs a Miller Trust?

Miller Trusts are essential for:

• Individuals with monthly income over $2,901 who need nursing home care
• People receiving Medicaid Home and Community-Based Services (HCBS) waiver services with income over the limit
• Anyone whose pension, Social Security, or other income is “just over” the Medicaid threshold

Important Miller Trust Restrictions

Unlike Special Needs Trusts, Miller Trusts are extremely limited:

• You cannot use funds for quality-of-life improvements
• The state must be named as beneficiary (Medicaid payback applies)
• Funds can only be used for specific allowable expenses
• Trustees have very little flexibility in fund management

Special Needs Trust vs. Miller Trust: Side-by-Side Comparison

Do You Need Both Trusts?

Yes, in many cases.

Example scenario: Your 62-year-old brother has cerebral palsy. He receives $3,200 monthly from Social Security Disability. He also has $75,000 in savings from a personal injury settlement years ago. He needs to move into a nursing home.

His situation:

• Income is $299 over Florida’s limit → needs a Miller Trust
• Assets exceed $2,000 limit → needs a First-Party Special Needs Trust

Without both trusts properly structured, he cannot qualify for Medicaid to help pay for his care.

Common Mistakes Florida Families Make

Mistake #1: Using the wrong trust type A Special Needs Trust won’t solve an income problem. A Miller Trust won’t protect assets. Know which issue you’re addressing.

Mistake #2: DIY trust documents Florida Medicaid trusts must meet specific legal requirements. One mistake can disqualify your loved one from benefits entirely.

Mistake #3: Funding trusts incorrectly How and when you fund these trusts matters. Improper timing can trigger Medicaid’s 5-year lookback period.

Mistake #4: Naming the wrong trustee Miller Trusts cannot be managed by the beneficiary. Special Needs Trusts require trustees who understand their fiduciary duties and Medicaid rules.

Mistake #5: Not updating trusts when circumstances change Marriage, divorce, additional children, changes in income—all require trust reviews and potential amendments.

Getting Special Needs and Miller Trusts Right in Florida

Both Special Needs Trusts and Miller Trusts are powerful planning tools, but they’re not interchangeable. Understanding the difference—and knowing which your family needs—can mean the difference between preserving benefits and losing them.

At Berg Bryant Elder Law Group, we’ve helped hundreds of Northeast Florida families establish trusts that protect their loved ones with disabilities. Our Florida Board Certified Elder Law Attorneys understand the complexities of Medicaid planning and can design a strategy that preserves both benefits and dignity.

We serve families throughout Duval, Clay, St. Johns, and Nassau Counties who need guidance protecting loved ones with disabilities.

Don’t risk your family member’s benefits with guesswork. Contact us today to discuss which trust structure is right for your situation.

This article is for informational purposes only and does not constitute legal advice. Trust requirements and Medicaid rules change frequently. For guidance specific to your situation, consult with a Florida elder law attorney experienced in special needs planning.