| We frequently work with families with special | | | | The second option for special needs planning is to |
| needs children to set up special needs trusts. A | | | | leave the assets to siblings with an understanding |
| special needs trust is simply a way to leave | | | | that the siblings will take care of their special |
| assets to take care of a special needs child | | | | needs brother or sister. This assumes that the |
| without jeopardizing their entitlement to | | | | sibling doesn't lose the money in a divorce or to a |
| government benefits. For a special needs individual, | | | | creditor and that they have the desire and |
| government benefits are often vital. Medicaid is | | | | energy to take care of their special needs sibling |
| typically the only type of health insurance that a | | | | for the rest of his or her life. This doesn't seem |
| special needs child can get. The problem in planning | | | | like a very good solution to the problem either. It |
| for a special needs child is that if you leave an | | | | places an unfair burden on the siblings and |
| inheritance directly to a special needs benefits | | | | assumes a "perfect" outcome where the non |
| recipient, they will lose their benefits. They will be | | | | special needs sibling never faces a financial crisis. |
| face with spending down those assets until they | | | | The third and best option for special needs |
| can re-qualify for Medicaid and oftentimes the | | | | planning is to create a special needs trust. By |
| assets run out months or years before they can | | | | creating a third party stand alone special needs |
| requalify for Medicaid. | | | | trust, you can leave assets to a special needs |
| Generally, there are three potential estate planning | | | | child that are not countable assets for Medicaid or |
| options for families with special needs children. The | | | | SSI purposes. The assets can be used to fill gaps |
| first option is to disinherit the special needs child. | | | | that are left in the government benefits programs |
| This would mean that there would be no | | | | and make sure that your special needs son or |
| interference with their government benefits | | | | daughter has a safety net to take care of them. |
| because there would be no inheritance from Mom | | | | Even when government benefits are not an issue, |
| and Dad. Unfortunately, this also sends a message | | | | a properly drafted trust with care manager |
| that the special needs child is not as important as | | | | provisions and a professional trustee can make |
| other family members. This seems like a very | | | | sure that your special needs child is not taken |
| poor solution to the problem. | | | | advantage of or abused. |