When meeting with a new person or family, it’s heartbreaking to learn that someone has a special needs person in their life that they want to provide for after death–but their previous attorney advised not to leave anything to that individual with special needs because it would “mess up” their benefits. There is better advice–leave it to that special person the correct way! That is what special needs planning is all about–ensuring that you can provide for a disabled beneficiary without jeopardizing the benefits they are entitled to.
Proper Special Needs Planning explores the uses of (and understanding the differences between) the various types of Supplemental (or “Special”) Needs Trusts (“SNT’s”). There are 1st Party SNT’s (requires Medicaid payback provision, funded with the disabled beneficiary’s own funds), 3rd Party SNT’s (no Medicaid payback provision, funded with funds from anyone other than the disabled beneficiary), Pooled SNT’s (like that of the ARC of Indiana). When creating a 3rd Party SNT, a funding strategy should also be thoroughly discussed outlining the types of assets that are best suited to fund such a trust. In other cases, a SNT may not be necessary, so it’s important to understand the use of an ABLE Account (similar to a 1st Party SNT, but it’s not a trust; it’s an account with special rules for people that had the onset of a disability prior to turning the age of 26).
Parents and legal guardians also need advice when their child with special needs is about to turn 18, such as exploring guardianship, understanding the myriad of available benefits, and deciphering FSSA/DFR correspondence during the application process. There is no simple “play-book” for parents in these circumstances, so we often sit down and create the game-plan.