Planning for the future of your children is an imperative part of parenthood, however this can be a complex and difficult task, especially for the parents of special needs children. Fortunately, governmental interests have recognized the difficulties faced by special needs persons and those who provide care for special needs persons, and the laws have adjusted to include and accommodate such individuals as an Arlington, TX estate planning lawyer can share.
What Is Your Special Needs Child Entitled To?
When considering how to best plan for the prosperity of your special needs child, it is good to know what care and services your child is entitled to. First, under the Individuals with Disabilities Education Act (IDEA), your child is entitled to free, appropriate, and public education. This includes an Individual Education Plan (IEP) and a Behavior Intervention Plan (BIP). Second, under the Americans with Disabilities Act (ADA), your child is entitled to reasonable and necessary accommodations to allow them an equal opportunity to enjoy their housing. This includes exceptions for service animals, handicap parking, elimination of referral requirements when applying for housing, and many other accommodations depending on their necessity and impact on the housing program as a whole. Third, under the ADA, your child is entitled to an equal opportunity of employment, so long as they are able to complete the essential functions of the job when provided with reasonable accommodation, and so long as an employer does not show that such employment would generate undue hardship on the operation of its business. Fourth, under Medicaid for the Elderly & People with Disabilities, your child is entitled to qualifying healthcare coverage if your household income is below 133% of the Federal Poverty Level (FPL). Lastly, your child may be entitled to Supplemental Security
Income if your single parent household has assets below $2,000 or a two parent household has $3,000. SSI is limited to use for basic needs such as clothing, food, shelter, and medical care as our friends at Brandy Austin Law Firm can share.
Can You Take Advantage Of The Benefits Provided To Your Child?
When planning for the prosperity of your special needs child, it is essential to know what benefits provided to your child are qualified and unqualified. Benefits provided through the ADA and IDEA are unqualified and limited in scope. Thus, as long as your child is shown to be disabled, benefits are limited to those reasonably necessary for your child. For example, if your child is given adequate accommodation within education, housing, and employment there are no extra benefits to reap through these programs. On the other hand, benefits provided through Medicaid and SSI are qualified and can be lost if your household income or asset balance exceeds the threshold set by the federal government.
How Do You Best Leverage The Benefits That Your Child Is Entitled To?
Many parents are faced with a Hobson’s choice, either maintain a household income below 133% of the FPL and an asset balance of less than $3,000 or stop receiving Medicaid and SSI benefits for their special needs child. What many don’t realize is that there is a perfectly legal loophole in the form of a Special Needs Trust. A Special Needs Trust may be established and funded by the disabled beneficiary (self-settled) or by a third party. Furthermore, these trusts are divided into two categories, a Supplemental Care Special Needs Trust and a General Support Special Needs Trust. For parents looking to continue Medicaid and SSI coverage for their child, it is best to establish a Third Party Supplemental Care Special Needs Trust. This type of Trust will allow parents to fund the trust with their own assets and at the same time, those assets will not prohibit them or their child from receiving Medicaid or SSI. Moreover, unlike a self-settled trust, a third party trust is not subject to reimbursement requirements for benefits provided by the
government. Additionally, the money in a Third Party Supplemental Care Special Needs Trust may be used for a wide variety of expenses including travel, entertainment, and everyday services; however, to maintain eligibility for Medicaid and SSI, the beneficiary cannot have any control over the money in the trust. Thus, the trust must be managed by a Trustee such as a family member or professional Trustee, who will determine when to make distributions of trust funds. It is important to remember that a trust can serve as a way to provide for your special needs child even after your incapacitation or death, and in many cases a trust will be better for your child than simply leaving them money in your will.
What Other Estate Planning Tactics Are Available For Parents Of Special Needs Children?
In addition to establishing a trust for your child, it is prudent to establish a guardianship in the event of your incapacitation or death. A guardianship will create a court appointed administrator to care for your child in the event of your incapacitation or death. Granted you and the guardian have followed all the legal requirements of a guardianship, a guardian has the legal duty to provide clothing, food, medical care, and shelter to your child upon your death. Furthermore, it may be prudent to grant a power of attorney which grants an agent the power to perform certain acts on behalf of your child. In the event that you do not establish a trust for your child or you expect your child to receive money after your death, you will want to grant a durable power of attorney. A durable power of attorney will allow an agent to manage your child’s property in order to ensure their financial prosperity. In the event that you do not establish a guardianship or you expect your child to be unable to make healthcare decisions for themselves, you will want to grant a medical power of attorney. A medical power of attorney will allow an agent to make healthcare decisions for your child; however, your child may revoke the agent’s power of attorney at any time.
If you have questions about any of this, reach out to a lawyer near you for help.
