If this situation describes you, you're not alone. Between 15-20% of Americans have some form of disability. This means that a significant portion, close to 12%, of American parents have to figure out a way to provide for and protect their disabled children after they're gone.
It's tough, of course, to think about our own eventual demise. But when those feelings are accompanied by anxiety about who's going to care for your disabled adult child or grandchild when you're gone, it can become emotionally-draining. Traditionally, benefits have been paid for by Social Security or Medicaid, but state and local governments have been steadily tightening the income requirements. Private-sector resources can be tough to find these days. Both the government and non-profits have cut funding to group-housing programs just as the disabled population is growing due to longer life expectancy.
In theory, it sounds good. But, unfortunately, it doesn't always work out that way. For one thing the child left with the burden of care - generally the one who lives closest to his disabled sibling - may not be happy with the arrangement. It may grow into resentment toward the other siblings, and it could end up causing family problems. Then there's the question of what might happen if the caregiver child gets divorced or dies. In cases like that the ex-spouse, or the children, could easily end up with the assets meant to care for the disabled child, leaving his or her care in jeopardy!
What is a Special Needs Trust?
The requirements for government-supported benefits are tight and getting tighter all the time. So your trust should be drawn up by an Elder Care-Special Needs attorney with expertise on specific income and asset requirements.
This is a way to put aside assets for a disabled child without endangering your (or your child's) eligibility for government benefits. These may be appropriate for families wealthy enough to leave a home to a child. But, to be sure, you'd need to speak with an Elder Law attorney, because legislative changes could cause the house to be counted as an asset - and end up disqualifying the child from SSI and Medicaid.
This type of planning is truly a maze. Which means you'd better have a guide who knows the way to walk you through it! At Kyle Wynn & Associates, special needs trusts are one of our specialties. We've walked many families through this maze. And we've done it with professionalism and dignity. Because we're well experienced in Elder Law and Special Needs planning, we know the rules of the game. And we know how to ensure that your wishes will be met.
You want to ensure that your disabled child has all the necessary resources once you're not there to provide them. And the time to do something about it is now, while you're able to do so. We can make the whole process a lot simpler and a lot easier. We'll be there for you every step of the way. And we're just a phone call away. If you haven't yet made provisions for your disabled child or grandchild what are you waiting for?
Call our office to set up your free appointment and start your planning now!
(601)-978-1700 or (800)-839-7857
What about Long-Term Care?
What if you leave assets to one child to care for the other?
In a very sad way, these developments have created a perfect storm working against the welfare of special needs beneficiaries. In fact, a recent report noted that the U.S. would have to expand residential services for disabled people by at least 28% to keep up with the demand. To make this "perfect storm" even more worrisome, some 65% of parents of disabled children have no plan for where their child will live when they get older. As a result, a cloud of unknowns hangs over many American families.
Decisions need to be made for the good of your disabled child or grandchild, about how and where they'll live, and who'll care for them if you can't. So this isn't something you should be putting off. As we all know, the future has a tendency to get here much faster than we think. You may not be able to do much about your child's disability, but there is something you can do about his or her future. You can structure your estate plan so that your child won't be disqualified for benefits when you're not around to provide for them anymore! There's no better time to start preparing than now. Here are a few tips:
To ensure that a disabled child would receive benefits, some parents simply leave most of their assets to another child, with the stipulation that they be used to care for the disabled one..
Many parents address this situation by giving each child an equal share, and putting the special-needs child's share in a trust. (With the wild gyrations of today's financial markets, it might be a good idea to consider funding the trust with a permanent life insurance policy.)
How do you get started?
If a parent requires long-term care while the child is still under 65, a Special Needs Trust may be a good idea. This allows the parent to qualify for Medicaid coverage by putting everything in the trust for the child. When adults seek Medicaid benefits to help pay for long-term care, there's a "look back" period. What does this mean? When considering whether the parent qualifies for assistance with long-term care, Medicaid can include any gifts they've given within the past five years as assets. . . which could preclude them from obtaining assistance. But the assets the parent put in a special-needs trust for the disabled child are not counted.
Estate Planning is tricky enough, but it's even trickier if one of your beneficiaries is disabled.
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