Estate Planning for Special Needs Children
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Like so many other aspects of parenting a special needs child, there are unique challenges and considerations in setting up your estate plan. It may seem overwhelming, but the good news is that there are tried and true tools available for special needs planning through the use of wills and trusts. You can name guardians and conservators in your will, and establish a special needs trust to protect your disabled child and your entire family long after you are gone. Below are some of the key issues that you should address with your estate planning lawyer.
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Special Needs Trust: Financial Security for Your Adult Child
Your child with special needs most likely will have limitations on his or her ability to earn income throughout their lifetime. This means that, despite a desire to treat all of your children equally, you may have to allocate more resources for your disabled beneficiary than for other children you have without special needs.
In addition, even if your child is legally competent, he or she may not function at a high enough level to effectively manage the inheritance. This means you may want to create a trust and have his or her inherited assets held in the trust.
If you want assets to go directly to your children instead of to your spouse, or want anything other than an equal distribution among all of your children, you have to have at least a will. If you want to ensure that someone you trust will be responsible for managing your disabled child's assets after you are gone, you are going to need a combination of wills and trusts, including a special needs trust or supplemental needs trust, and appointment of an appropriate trustee to help manage the assets your child receives.
In addition, even if your child is legally competent, he or she may not function at a high enough level to effectively manage the inheritance. This means you may want to create a trust and have his or her inherited assets held in the trust.
If you want assets to go directly to your children instead of to your spouse, or want anything other than an equal distribution among all of your children, you have to have at least a will. If you want to ensure that someone you trust will be responsible for managing your disabled child's assets after you are gone, you are going to need a combination of wills and trusts, including a special needs trust or supplemental needs trust, and appointment of an appropriate trustee to help manage the assets your child receives.
Special Needs Trust: Protecting Your Child's Eligibility For Benefits
Many people with special needs are eligible for federal Supplemental Security Income (SSI). They also may qualify for other need-based federal, state, or local public benefit programs. These sources of income from public benefit programs can be critically important for your child throughout his or her lifetime, especially after you and your spouse are gone or unable to take care of their needs.
You don't want to jeopardize eligibility when your child suddenly receives assets in an inheritance, but you likely don't want to leave your child out of your estate plan. Many parents address this by setting up a special needs trust to hold these assets for the personal with a disability. The trust should also to set out clear guidance for the trustee who will administer and oversee the trust assets. If set up correctly the assets in that trust will not count in determination of continued eligibility for benefits.
You don't want to jeopardize eligibility when your child suddenly receives assets in an inheritance, but you likely don't want to leave your child out of your estate plan. Many parents address this by setting up a special needs trust to hold these assets for the personal with a disability. The trust should also to set out clear guidance for the trustee who will administer and oversee the trust assets. If set up correctly the assets in that trust will not count in determination of continued eligibility for benefits.
Guardians and Conservators for Special Needs Child
Of course, if your child is a minor you will want to name a guardian in your will. Your child with physical or mental disabilities may still need a guardian and/or a conservator after reaching adulthood. In addition, these roles may need to be more specifically described and planned, as there may be some things that your child can manage on his own and others that he cannot. For example, he may be able to live independently and make adult decisions, but not to manage finances,. In that case, you will want to identify someone with legal authority to help with financial decisions.
Chances are this is currently (or will be) you or your surviving spouse, but it is important to think ahead about what other family members can take your place so that the transition is as smooth as possible for your child.
It is also a good idea to prepare the guardian for this responsibility with as much information as you can provide about your disabled child. Even a simple letter with a list of medical providers, likes and dislikes, and what you want for your child can go a long way in helping the successor guardian make things easier for your child.
Chances are this is currently (or will be) you or your surviving spouse, but it is important to think ahead about what other family members can take your place so that the transition is as smooth as possible for your child.
It is also a good idea to prepare the guardian for this responsibility with as much information as you can provide about your disabled child. Even a simple letter with a list of medical providers, likes and dislikes, and what you want for your child can go a long way in helping the successor guardian make things easier for your child.
In Summary: The Documents You Will Need to Protect Your Child With Special Needs
Your estate plan should include:
- Wills for you and your spouse which identify a guardian and/or conservator for your disabled child and any other young children;
- Trusts to protect as many of your assets as possible from estate tax and the potential future cost of long term care for you and your spouse; A special needs trust to protect your disabled child's eligibility for government benefits; A durable power of attorney for you and your spouse;A health care proxy for you, your spouse, and your special needs child if he/she is an adult, with alternates identified in case something happens to you and your spouse.
- A list of your child's medical and other providers with a brief description of the services they provide.
- A summary of your child's functional strengths and weaknesses- what they can do independently, where they need help, their most common sources of frustration, etc.
- A copy of your child's most recent IEP or 504 plan if they are still school-aged.
How Our Estate Planning Lawyers Can Help
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Jenna Ordway
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We are ready to help you put a comprehensive plan in place that meets all of your needs and your family's needs. We also know how hard it can be to get started, and do our best to make this process as easy as possible for you. You can use the button below to schedule a call back from a member of our team, or give us a call at 781-784-2322.
