How should I conduct my Estate Planning if I have a child with Special Needs?
Advancements in medical treatment and parental education have drastically increased the life expectancy of children with special needs. As a result, parents are justified in being concerned about the likelihood of their special needs child outliving them. Since there are many options to choose from, careful consideration should be taken by parents when deciding how to best manage the long-term care of their special needs child after they are gone.
The first solution that often comes to mind for providing for a special needs child is direct inheritance. Leaving money or assets directly to a special needs child is, almost 100% of the time, a very poor plan. While advancements in treatment have allowed people with special needs to live much longer, more enriched lives, there are aspects of their life in which their interests are best served by certain responsibilities lying with another party.
Another commonly presented solution is leaving all of one's estate to healthy children, with the expectation that they will meet the needs of their special needs sibling. This scenario presents an ideal situation; however, even in an ideal setting circumstances can (and will) change. Among the many changes that could possibly occur: a healthy child's job may require a cross-country move; should a divorce occur, the assets meant to provide for the special needs child may end up in the possession of an ex-spouse; the healthy child could pass away before the special needs child whom they are expected to care for, etc. As one can imagine, there are a plethora of scenarios in which this solution becomes unrealistic.
By and large, the safest, most dependable way to guarantee that a special needs child is cared for upon the death of their parents is a Special Needs Trust. One of the major benefits of this type of trust is its ability to provide for the needs of the special needs person, while not disqualifying them from government benefit programs like Supplemental Security Income (SSI) and Medicaid.
Similar to other Estate Planning trusts, a Special Needs Trust (sometimes called a Supplemental Needs Trust) can take several different forms. These forms may include:
– Third-Party Trusts
– Self-Settled Trusts
– Pooled Trusts
Each option has advantages and disadvantages that are situation specific and should be discussed with an estate planner.
A word of caution about any type of Special Needs Trust: a well-meaning relative or close family friend may unintentionally undermine the entire estate plan by leaving assets and/or funds to the special needs child, thereby disqualifying the special needs person from receiving government benefits. Should one of these potential benefactors wish to contribute to the child's long-term care, another trust can be created to receive those funds. All the family and friends would need to do is incorporate this trust into their own estate plans. Careful planning and communication can easily circumvent the unintentional undermining of a Special Needs Trust.
If you need help with a Special Needs Trust for you or someone you know, the Conroe Texas special needs trust attorneys at Peterson Law Group can help. Contact them today by calling 936-337-4681 or through our online contact form.