If you ask the parents of children with special needs which child needs the most assistance from the inheritance and planning of the parent, they’ll always say their child with special needs. Then why is it that most parents have never heard of a Special Needs Trust in Utah? Why are most parents advised that they will have to disinherit and “wish good luck” to their child that needs assistance the most? Why is the next best advice to disinherit the special needs child and distribute his share to his siblings to “take care of him?” There’s a recipe for disaster! Using a lawyer in Utah can assist you in addressing these issues.
Typically, the advice to parents of children with special needs is to disinherit the child because, once the child with Special Needs emancipates (turns 18), Social Security, Disability, Medicaid, Medicare, Food Stamps, Housing, Vocational Rehab, etc. and all other benefits all are based on the assets of the child. If that child inherits money or a home or a boat or insurance proceeds, that will count as an asset of the child—they will LOSE all the State and Federal benefits they rely on. The easy economic decision then to disinherit, but it makes for an awful feeling for the parents disinheriting and leaving no assets or money to the child with the greatest need.
Example: A family of 5 children, one of whom has special needs, is set to inherit $1 million from the parents at their death. Each would receive $200,000.
The Child with special needs would lose the benefits she needs for Medicaid, Food, Housing Assistance, etc. and be forced to use that $200,000.00 to pay for medical bills, rent, groceries, prescriptions, and so on until the inheritance is exhausted.
For a family trying to follow the “next best” advice, and disinherit the child, but divide the special needs child’s share among the other children, then the burden falls to the siblings to “help” out the sibling with special needs. This leads to a host of problems. Typically, one child has a greater affinity to their sibling with special needs and will do more to care for that sibling; others, while they love the sibling, may think “I’ll invest this money for them” or have other motives for not spending the money on that child. This attitude often leads to conflicts between siblings, money conflicts, and family discord.
What’s the right answer? A special needs trust sets a firewall between the assets or inheritance and your special needs child. A special needs trust allows you to establish which sibling (after you pass on) will care for your special needs child. A special needs trust allows you to shield all your child’s government benefits and protect his ability to live a full and fulfilled life. You never know what the future holds. There is no sense in sacrificing government services that could be beneficial for your disabled loved one in the future. An experienced Utah special needs trust attorney can assist you in navigating how to set up properly the trust.
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Call our office at (800) 265-2314 to schedule a free consultation and take the first step toward a set up a special needs trust in Utah.