Planning for the future is important for every parent; however, if you are the parent of a child with special needs the planning ahead takes on an even greater importance. Like most parents, you may wish to support your child, both financially and emotionally, throughout your lifetime. You may also hope to pass assets down to your child when you are gone. If your child has special needs, however, providing financial support once he/she reaches adulthood or passing down assets in your estate plan could do more harm than good if you don’t plan accordingly. At The Mendel Law Firm, L.P. we understand your dilemma and are here to help by showing you how to incorporate Special Needs Planning into your comprehensive estate plan.
Why Is Special Needs Planning Necessary?
As you likely already know, raising a child with special needs can be costly. As a parent, you want your child to have the brightest – and most independent – future possible. That often requires expensive medical care, therapy, and specialized equipment. Fortunately, many children with special needs do grow up to live fairly independent and self-sufficient lives. Most, however, will continue to need some type of ongoing medical and/or therapeutic care as adults. The good news is that programs such as Medicaid and Supplemental Security Income (SSI) can help offset the cost of that care for your child’s entire adult life. The bad news is that once your child reaches adulthood, he or she will have to qualify for those assistance programs and any financial help you give your child could jeopardize his/her eligibility. Special Needs Planning anticipates this very dilemma and plans accordingly.
The Special Needs Trust
Most state and federal assistance programs limit the value of assets an applicant can own for eligibility purposes. Therefore, any financial help you give your adult child or any direct gifts you make, during your lifetime or at the time of your death, could disqualify your child for much needed assistance. For many parents in your position, a Special Needs Trust is the answer. Also referred to as a Supplemental Needs Trust, a Special Needs Trust is a special type of irrevocable living trust that allows you to designate assets to be used for the care and maintenance of an individual with special needs without the risk of losing eligibility for state and federal assistance programs. The trust assets may only be used to provide supplemental care over and above that which is provided by programs such as Medicaid and SSI. Because very specific language must be used for a trust to be recognized as a Special Needs Trust, it is imperative that you work closely with an experienced Special Needs Planning attorney during the creation of your trust.
At the Mendel Law Firm, L.P. we are committed to helping you incorporate Special Needs Planning strategies and tools into your comprehensive estate plan to ensure that your child is well cared for without risking eligibility for state and federal assistance programs. Contact the team today by calling 281-759-3213 or fill out our online contact form.