Planning for Life

5 Reasons Why Disinheritance is Not a Viable Option for Special Needs Planning

Posted by Harry S. Margolis on February 2, 2015

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By Harry S. Margolis

Some parents of children with special needs choose to disinherit such children for a number of reasons. They recognize that leaving funds directly to such children (who very well may be adults now) could cause a number difficulties. Their children may lose eligibility for important public benefits, such as Supplemental Security Income, MassHealth or subsidized housing. In many instances, their children would not be able to manage the funds and would be susceptible to losing the funds to financial predators or simply bad decisionmaking. Other parents reason that their other children will take care of the child with special needs or that the child has no need of funds since public programs are providing for her adequately.

Some parents recognize that a special needs trust would address many of these issues, but would prefer to avoid it due to fears about cost and complexity. Here are five reasons to reconsider:

  1. Don't rely on public benefits programs. With federal, state and local budgets continually under pressure, no one can be sure that public benefits programs available today will continue into the future. Even with no financial pressure, public policy can change. Currently, the federal government has directed states to close down larger group homes. It's important that your child have resources in case of a change, or simply to hire an advocate when necessary.
  2. Don't assume your child's needs won't change. While the current arrangement you have for your son or daughter may, fortunately, be working well now, his or her needs may change in the future. May need to pay out-of-pocket for care or advocacy that is free or unnecessary today.
  3. Don't create discord among your other children. Assuming that your other children will take care of your son or daughter with special needs may work out fine. But it may not. We've seen all too many cases in which one sibling takes on the responsibility for the brother or sister with special needs, while others do not. This may or may not breed resentment, but it almost certainly will if the caretaker sibling also must use her own funds to pay for the needs of the brother or sister with special needs. Don't create a situation that is likely to lead to tension among your children.
  4. Don't rely on your other children to always be there. In the best case scenario, your non-special needs children will always be there physically, financially and emotionally for their sibling with special needs. But there's no guarantee. Ill health, death, financial reverses, pressures from a spouse, or the need to move to another part of the country can all impede a sibling's ability to care for and pay attention to a brother or sister with special needs. Funds set aside in a special needs trust can be used to hire professional care or pay for visits from family members.
  5. Don't be afraid of special needs trusts. While trusts are legal documents that need some explanation and there's a cost to setting them up and ultimately administering them, their benefit is so great that it's worth the cost.

In short, special needs trusts can be great tools for protecting both the child with special needs and his or her siblings. To learn more about how they work, click here.

Topics: special needs planning

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