Wednesday, March 26, 2014
As I have previously discussed, unique estate planning concerns arise when a person has a child with a disability. When children have emotional or behavioral disabilities, the family may be faced with significant emotional and financial difficulty. With 3.5 million youth facing these kinds of disabilities in the United States, it is important for families to plan for the financial stability of affected children if they are no longer able to. A Special Needs Trust (SNT) can provide the needed financial support.
SNTs provide income to the beneficiary for non-essential expenses, but do not limit the child’s ability to qualify for assistance from the government as well. The trusts may be funded by the parents through a variety of methods, but restrictions arise when the trust is funded through personal assets of the beneficiary. When trustee appointment is a concern for the parents, a pooled special needs trust is another option as it is managed by a non-profit, and thus managed by professionals rather than an individual.
See Richard Newman and David Foster, Planning For the Needs of Exceptional Children, Wealth Management, Feb. 18, 2014.
Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) and Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.