Planning for a child with special needs requires extra care. Individuals with special needs often depend or will depend on needs-based government benefit programs like Supplemental Security Income (SSI) and Medicaid, which have strict income and asset guidelines for eligibility.
Because of those guidelines, leaving an inheritance outright to a child with special needs who receives SSI and Medicaid will frequently disqualify him or her from receiving those benefits.
The goal in estate planning for a parent who has a child with special needs is to ensure that any assets left to the child at passing are not considered an available resource for purposes of those needs-based programs. That can be accomplished in several ways.
For many parents, the ideal planning technique is a Special Needs Trust. A Special Needs Trust is a specialized trust that ensures any amounts are available to supplement the child’s needs-based assistance while not triggering a loss of eligibility. A Special Needs Trust, if drafted correctly, can also avoid a Medicaid payback – a payback to the State of Ohio for any benefits the child had received while living – at the death of the child, which allows the parent who established the Trust to control the ultimate disposition of any remaining trust assets.
A Special Needs Trust is certainly not a “one size fits all” solution, and every family’s needs are different.
To discuss any estate planning needs in confidence, please contact Ritter & Randolph, LLC to schedule an initial consultation.