Caring for Your Special Needs Child: The Special Needs Trust

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Category: Education
     
 

Presentation Description

Raising a special needs child costs more. Your special needs child will likely be dependent to some degree forever. You may Want to provide funds in your estate plan to supplement his /her care. This presentation talks about federal benefit programs that help with the cost of caring of your special needs child or adult.

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Presentation Transcript

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Caring for Your Special Needs Child The Special Needs Trust

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The Need for Special Needs Planning

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Estate planning is important for everyone but takes on a heightened importance for parents of a special needs child

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Failing to plan could have unintended negative consequences

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Financial Costs

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The parent of a special needs child may not want to dwell on the financial aspect of raising the child but reality is that it costs more

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Raising a special needs child costs more

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Your special needs child will likely be dependent to some degree forever

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You may want to provide funds in your estate plan to supplement his/her care

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Benefit Programs

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There are numerous state and federal benefit programs that help with the cost of caring for a special needs child or adult

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Entitlement programs do not take recipient’s income or resources into account

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Means test programs do consider income and resources

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Social Security Disability Insurance 1

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Entitlement program Known as SSDI Provides monthly monetary benefit Eligibility based on parent’s earnings record Parent must be collecting retirement or disability or be deceased

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Medicare 2

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Federal program Entitlement program Provides healthcare Special needs adult receiving SSDI may qualify regardless of age

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Medicaid 3

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Jointly funded by state and federal governments Administered by states Means test program

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Provides healthcare Income and resources considered Important of special needs individual may need long-term care because Medicare does not pay for long-term care

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Supplemental Security Income 4

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Federal program Means test program Provides monthly monetary benefit Income and resources considered Prior work history of parent not important

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Supplemental Nutritional Assistance Program 5

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Known as SNAP Formerly the Food Stamp program Means test program Provides monthly assistance purchasing food Income and resources considered

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ESTATE PLANNING MISTAKES

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Estate planning with a special needs child requires careful planning and considerations

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There are numerous pitfalls that can derail an estate plan that is intended to protect a special needs child

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FAILING TO PLAN

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Without an estate plan the Texas laws of intestate succession will determine how your estate is distributed

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Chances are good that your special needs child will inherit a portion of your estate

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That inheritance could cause your child to lose his or her eligibility for benefit programs

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DISINHERITING YOUR CHILD

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A parent may completely disinherit a special needs child in an attempt to ensure that the child does not lose benefits

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Child may be aware of the disinheritance and feel unloved

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No provision for providing supplemental assistance to child in the future

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TRANSFERRING THE INHERITANCE

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Parent may leave a special needs child’s inheritance to siblings Hope is that the siblings will use the funds to care for special needs sibling Assets subject to creditors of siblings as well as to loss in a divorce Sibling under no legal obligation to use the funds as intended

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THE SOLUTION – SPECIAL NEEDS TRUST

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Also referred to as “Supplemental Needs Trust” Let’s you appoint professional trustee to manage trust funds Specific language required Protects trust assets from creditors Medicaid cannot recover from trust assets after child’s death

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Learn More About Special Needs Trust in Houston Texas

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www.mendellawfirm.com The Mendel Law Firm, LP (281) 759-3213

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