Parents of special needs children face unique challenges when it comes to planning for the distribution of assets after the parents have passed away. Funds are necessary to ensure the long-term care of special needs adult children once their parents are no longer able to provide for them. The creating of a special needs trust allows a parent to be sure that his or her children are taken care of without worrying about interfering with their child’s eligibility for public assistance programs or fearing that unscrupulous people will rob a child of an inheritance. While creating trusts for clients who have children with special needs is becoming more commonplace, there are some things that your special needs trust attorney may not tell you.

Heirs Have Limited Control

There are different levels of disability that may allow some adults with special needs to have a greater ability to manage their own finances. In these cases , special needs trust is used primarily to protect the beneficiary from losing access to vital public benefits such as medical insurance.  Unfortunately, once a special needs trust is established, the beneficiary usually has little personal control over the finances. The trustee has complete control over the funds and must approve the requests made by the beneficiary before funds are disbursed. A financially conscientious beneficiary may feel frustrated and upset by his or her inability to control finances without oversight from a third party.

Medi-Cali Payback

Trusts for special needs individuals can be set up in a variety of different ways. The way the trust is established and funded affects which rules apply. A trust that is funded incorrectly or not established legally could be subjected to Medi-Cali payback rules. These rules allow the funds to be used to reimburse the government for medical care that was paid out on behalf of the person for whom the trust was established. Depending on the amount in the trust, it is possible to have the entire trust drained in order to pay back medical expenses.

Annual Fees

The yearly expense of managing a special needs trust can be extremely high, especially if the trust is not established by an attorney or financial planner. Without professional guidance, a person may experience substantial difficulty establishing a trust only to find out that it is impossible to maintain due to annual expenses. Knowing the actual cost needed to set up and maintain a trust is an important part of keeping the trust useful and compliant. Creating the trust without research and being forced to terminate it can lead to the very financial hardships the trust was created to avoid.

Consult an Attorney

Establishing a special needs attorney is one of the most important things that you will do to secure the future of your child. It is vital that you consult a trustworthy professional who can give you the legal advice and guidance necessary to protect your child and his or her inheritance.  Marivel is a compassionate special needs trust attorney at MMZ Law and will work with you to create a trust that focuses on protecting the rights of your child. Conveniently located in Claremont, California we are dedicated to providing you with the assistance you need to create a trust that complies with the law while conforming to your individual needs. Contact our office today to schedule a consultation so that we can discuss your needs and answer your questions.

*We service Elder Law through Medi-Cal Asset Protection Planning



341 W. 1st St. Suite 100
Claremont, CA 91711

MARIVEL M. ZIALCITA is the founder of MMZ LAW, A Professional Corporation, where she practices in the areas of Elder Law – Medi-Cal Planning Asset Protection, Trust & Estate, Special Needs, Conservatorship, Trust Administration, & Probate. Ms. Zialcita is a frequent speaker on trust and estate matters and holds memberships in the State Bar of California, Trust and Estate Section, The San Bernardino County Bar Association, Wealth Counsel and Elder Counsel. She currently assists in the pro bono legal services program at the James L. Brulte Senior Center in Rancho Cucamonga, California. She is based in Claremont but assists clients throughout Southern California.

This information is educational information only and not legal advice.