If you are the parent, grandparent, or loved one of a special needs child you are likely all too aware of the financial costs associated with your child’s care. You should also understand the importance of planning for your child’s future. Care must be taken when including your special needs child in your estate plan, or in the estate plan of well-meaning family members, to ensure that your child is well provided for both now and in the future without jeopardizing eligibility for much needed state and federal assistance programs.
As the parents or loved one of a special needs child we know you are concerned about their future. The special needs planning attorneys at the Kuhn and Kuhn Law firm are dedicated to alleviating as many of those concerns as possible through careful and timely estate planning. Contact our firm by calling 843-577-3700 or by using our online contact form today to get started on your special needs planning.
Why Direct Gifts Do More Harm than Good
As the parent or family member of a special needs child you already know how much it costs to provide quality care. This knowledge likely has you, and other family members, concerned about the future when you are no longer here to cover those costs yourself. Simply gifting money or assets to your special needs adult child is not a viable solution in most situations; gifts will likely interfere with their eligibility for benefit programs such as Medicaid or Supplemental Security Income (SSI). The resource limits for state and federal benefit programs preclude your special needs loved one from receiving direct gifts made by well-meaning loved ones.
The Solution? Creating a Special Needs Trust
The good news is that careful estate planning by an experienced attorney can prevent your loved one from losing eligibility for assistance programs and ensure that sufficient assets are made available to supplement the care provided by those programs. One common option is to create a “Special Needs Trust”, also referred to as a “Supplemental Needs Trust”. The concept behind a Special Needs Trust, or SNT, is simple. A SNT allows you to designate assets now, or upon death, to be used to supplement the care and maintenance provided by state and federal programs without interfering with eligibility for those programs. Very specific language must be used when creating a SNT to guarantee the trust will be recognized as a SNT. For this reason alone, you should work closely with your estate planning attorney when incorporating special needs planning into your overall estate plan.