Special Needs Estate Planning

Serving Clients throughout Bernardsville, NJ, Somerset County and the Surrounding Areas


Special Needs is a broad category of care requirements for individuals with a wide range of disabilities, including physical, intellectual and developmental disabilities as well as mental illnesses.

While they are alive, parents of children with disabilities will often ensure that their children receive the best care possible. But what happens when those parents are no longer around to provide the necessary support? Developing a long term plan for persons with disabilities is absolutely critical to ensuring that they have as long and enjoyable of a life as possible.

What help will the government give us to help financially with our special needs child?

The Federal and State governments have numerous benefits that are available to individuals with special needs. These programs vary from State to State, and many have some type of waiver program that will cover residential, daycare, career and other basic services.

Some of these major governmental programs include: (i) Medicaid, which gives basic medical care; (ii) Supplemental Nutrition Assistance Program (SNAP/Food Stamps) and Supplemental Security Income (SSI), which provide allowances for food and shelter to people with disabilities; and (iii) Social Security Disability Insurance (SSDI), which financially helps those with a disability, but has very stringent qualification requirements. While some of these programs do not have financial means-based restrictions, some are only provided to people who meet very stringent financial means-based requirements.

What is a Special Needs Trust?

A Special Needs Trusts is a very special and complex type of trust designed to benefit a disabled person who is either already receiving means-tested governmental benefits (e.g., Medicaid) or is expected to receive such benefits in the future. There are two types of special needs trusts that are commonly prepared for disabled individuals: Third Party Special Needs Trusts and Self-Settled Special Needs Trusts. A Third Party Special Needs Trust is the preferred form of distribution when a relative desires to distribute any of their assets to a disabled person. A Self-Settled Special Needs Trust is commonly used when a disabled person receives money as a result of a personal injury litigation or an unexpected inheritance. The primary purpose of Self-Settled Special Needs Trusts is to prevent the disabled person from losing their governmental benefits. Both types of Special Needs Trusts are designed so that the trust funds are not considered "available" to the disabled beneficiary for purposes of qualifying for means-tested governmental programs.

While the general purposes of these two types of trusts are similar, they are very different with respect to how they are created, and both types must be carefully drafted and administered in order to achieve their intended goals.

There’s a lot to keep straight. How do we stay organized?

If you have a child with special needs, it is critical that you maintain all of their documentation in one safe place that you can access easily when needed. Experts suggest that parents of children with special needs should have a file or lockbox to keep all of the information that future caregivers will need to care for the child after the parents have passed away.

Make sure that you regularly update the information in the file when there are changes in your family’s situation, changes in the needs or desires of your child, and to detail any other issues that may help future caregivers in caring for your child.

So what exactly should be in my file?

Of course, there is no exact list, but you should include these types of documents and maintain your file with any changes:

  • Important legal documents, such as birth certificates, Social Security cards, medical records, prescriptions, and health insurance cards;
  • A Letter of Intent – a non-binding document that gives vital information about the child with special needs to his or her future caregivers. This can be details like your child’s sleeping preferences, eating habits and favorite foods, activities and hobbies, and other aspects of his or her routine;
  • Copies of special needs or life insurance trusts that may be in effect (the signed copies or originals may be required to complete property transfers, so also include details about the location of the originals);
  • A list of major assets and information about where they are located, such as insurance policies, investments, bank accounts, and contact info for brokers, insurance agents and investment advisors;
  • Guardianship documents;
  • The contact information for government agencies or case workers with whom you have worked;
  • A list of governmental benefits your child may receive, as well as copies of completed applications; and
  • Any other documentation that would assist future caregivers (e.g., tax returns for your child, information about housing, educational programs, family photographs and small mementos).

That’s a lot to cover. Why not let an experienced special needs planning attorney help you? A special needs planning attorney has the background to make your lives easier. Make an appointment to visit with Varian Law LLC today. In addition to the drafting and implementation of Special Needs Trusts, Varian Law LLC assists our clients with many other issues related to planning for disabled individuals with special needs, including guardianship proceedings.

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