Even if you have the full means to provide financial support for your adult child with special needs, you should do everything you can to prevent denial of additional benefits to them in the future.
Many government programs offer assistance to adults in Chicago who are unable to work or otherwise support themselves because of a disability or mental illness. We understand the importance of structuring the assets of people with special needs so that they remain eligible for benefits from as many different sources as possible.
Assets can reduce or eliminate government assistance
According to the Autism Society, while your child is still a minor, public services generally do not consider your financial well-being when dispensing disability benefits. However, public financial assistance programs like Supplemental Security Income, Medicaid, housing subsidiaries and food stamps often have stringent guidelines regarding an adult applicant’s wealth. When your child turns 18, beneficiary-held assets such as standard savings accounts, inheritances or settlements all contribute to his or her overall financial worth. If these assets are not carefully structured, they could reduce or eliminate your son or daughter’s eligibility for government disability benefits.
Special needs trusts can financially protect adults with disabilities
Your child does not own a special needs trust, and so it is not counted among his or her assets when determining public assistance entitlement. Yet, the trustee can use the money to pay for any of your child’s expenses according to the trust’s directive.
There are several types of trusts for those with disabilities that vary in funding sources, regulations and remainder disbursement. The assets that supply a first-party trust can come from an inheritance or financial settlement given directly to your child. You can also set up a third-party trust that you can fund continuously for the rest of your life. Depending on the type, the trusts are either irrevocable or revocable, and any funds remaining after your child’s death might reimburse Medicaid or go to a named beneficiary.
A correctly structured financial plan can help ensure that your child with a disability can remain eligible for government benefits long after you are gone. Please visit our webpage for more information on special-needs planning.