If I had a dollar for every parent or grandparent who thinks that leaving a disabled child’s inheritance to a sibling or other loved one who will “take care of” the disabled child is a good idea, I’d be wealthy. That’s actually the worst thing to do.

What if the loved one dies or becomes disabled? What if they get sued or divorced? Now that Americans are living longer than they did in years past, including those with disabilities, this is an especially important subject.

Planning by parents and grandparents can make all the difference in the life of an adult child with a disability, as well as that of his or her siblings who may be left with the responsibility for caretaking (on top of their own careers and caring for their own families).

Supplemental needs trusts (also known as “special needs” trusts) are an important component of planning for a disabled child, even when the child is an adult. These trusts allow a disabled beneficiary to receive inheritances, gifts, lawsuit settlements, or other funds and yet not lose her eligibility for certain government programs like Medicaid.

As their name implies, supplemental needs trusts are designed not to provide basic support, but instead to pay for comforts and luxuries that could not be paid for by public assistance funds. These trusts typically pay for things like education, recreation, counseling, and medical attention beyond the simple necessities of life.

So do your loved ones a favor, speak with an Elder Law Attorney about creating a Supplemental Needs Trust. Contact our office with any questions you may have.