Protecting Your Special Needs Child Long After You are Gone
Anyone with a special needs child knows that specific care is needed to ensure their well-being. Whether your child is still a minor or they are an adult, a special needs trust can be set up to provide for their care long after you have passed away. A special needs trust operates similarly to a traditional trust, but with a variety of additional regulations to ensure the beneficiary benefits from the assets set aside for them.
One of the most important differences about a special needs trust is that the beneficiary (your child) won’t be the one who owns and controls the assets in the trust. Instead, a trust administrator will manage them on behalf of your child. These assets can be used only for costs that aren’t covered by state or federal benefits. For example, if your child requires a specific wheelchair to cope with their disability and it isn’t covered by Cali-Care, the trust would pay for it. The administrator of the trust would pay for the wheelchair in this example directly from the trust, and not to the beneficiary first.
A special needs trust can also be used for day-to-day expenses including, but not limited to, medical expenses, education, clothing, rent or housing, travel, and more. When funds are given directly to the beneficiary, it will become income, and must be reported on the annual benefits review.
Having a special needs trust is the ideal way to ensure your child benefits from the assets you are leaving to them and that they are properly cared for. This type of trust, however, can be quite complicated, so it must be handled by someone with experience in this area. If you have a special needs child that you would like to start saving for, please contact us to schedule a consultation.
