I have many clients who have special needs children. It is incredibly rewarding when I explain to them that they can leave money to their special needs child in a way that will preserve that child's ability to receive SSI, Medi-Cal, and other needs based public assistance. Many of these parents had been told that they could not leave anything to their disabled child and were relieved to discover that they could do so. I have had several parents who had been told by an attorney that they had to disinherit their special needs child. Needless to say, they never went back to that attorney.
How is this done? Through the use of a special needs trust. The special needs trust is an incredibly powerful estate planning tool that will allow the donor (typically the parents) to set aside money or other assets for the benefit of a disabled beneficiary (typically a special needs child) in a way that will not interfere with the disabled person's ability to receive public assistance. A trustee will manage the money on behalf of the disabled beneficiary and, although there are many rules to be aware of, the cardinal rule is to never pay any money from the special needs trust directly to the disabled beneficiary. Rather, the trustee pays for things the disabled beneficiary needs.
It is even possible for a disabled person to setup their own special needs trust with their own money (received from a personal injury settlement, inheritance, etc.) if they and the special needs trust meet certain requirements set down in Federal law.
How is this done? Through the use of a special needs trust. The special needs trust is an incredibly powerful estate planning tool that will allow the donor (typically the parents) to set aside money or other assets for the benefit of a disabled beneficiary (typically a special needs child) in a way that will not interfere with the disabled person's ability to receive public assistance. A trustee will manage the money on behalf of the disabled beneficiary and, although there are many rules to be aware of, the cardinal rule is to never pay any money from the special needs trust directly to the disabled beneficiary. Rather, the trustee pays for things the disabled beneficiary needs.
It is even possible for a disabled person to setup their own special needs trust with their own money (received from a personal injury settlement, inheritance, etc.) if they and the special needs trust meet certain requirements set down in Federal law.
As can be seen, the special needs trust is a powerful tool, both for the parents or other loved ones of a disabled beneficiary and for the disabled beneficiary him- or herself.
Gerald Cummings
Gerald W. Cummings is a San Jose, California attorney who helps families find peace of mind. He is on the web at www.cummingslegal.com and can be reached at (408) 286-2122.
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