Parents who are caring for a child who has special needs might know that the child will need to rely heavily on needs-based programs like Medicaid throughout their life. This can make it difficult to set up an estate plan that takes care of the child when both parents pass away. One option that might make this a bit easier is using a special needs trust so assets can be passed along to help but without impacting their ability to get the services they need.
A special needs trust is an irrevocable trust that’s controlled by a trustee. Since the beneficiary doesn’t have control over it, the contents of the special needs trust don’t count as their assets. This is why establishing it is a good idea. It’s an option that you have to help care for your child even after you’re gone.
There are many ways that the trustee can use the special needs trust to benefit your child. It can be used to help improve their quality of life. The trustee can use it for things like entertainment or to supplement their medical coverage. The wording in the trust must make it clear that the funds aren’t meant to be a primary source of support.
Once you determine that you want a special needs trust for your child, there are some other decisions you have to make. These trusts can be set up in different ways, so you have to find the one that meets the needs of your situation. This can give you peace of mind in knowing that your child will have the care they need even after you’re gone.