How Can I Protect a Loved One with Special Needs in My Estate Plan?

If you have a loved one with special needs, you likely worry about their well-being every single day. What’s more, you likely worry about how they are going to be taken care of once you, unfortunately, pass on. Though it is sad to think about, you must prepare for this inevitable situation. Follow along to find out how your estate plan can protect your loved one with special needs and how one of the proficient Butler County special needs planning attorneys at Heritage Elder Law & Estate Planning, LLC can walk you through your options.

How can my estate plan protect a loved one with special needs?

The most common way to protect a loved one with special needs in an estate plan is via a special needs trust. This trust may be beneficial to establish if your loved one has a certain lifelong condition (i.e., autism, Down Syndrome, etc.) or a certain debilitating disease (i.e., Parkinson’s, Alzheimer’s, etc).

Of note, there are different types of special needs trusts recognized in the state of Pennsylvania. They are as follows:

• First-party trust: this type of trust is created by a parent, grandparent, or legal guardian, and may only be funded by the beneficiary’s funds. This allows the beneficiary with disabilities to retain not only their government benefits but also their funds while not going over resource limits.
• Third-party trust: this type of trust is created by and funded by another person (i.e., a parent, grandparent, or legal guardian) for the beneficiary. This allows life insurance funds and other gifts to be contributed to the beneficiary while not affecting their government benefits.
• Pooled account trust: this type of trust is created by a non-profit organization for the beneficiary and their family. This allows expenses, other than basic needs provided for by government benefits, to be supplemented.
• Hybrid trust: this type of trust is created by the same person that will be receiving the funds. This allows the person to receive government benefits alongside the funds of the trust for the remainder of their life.

How else can I help my loved one with special needs?

In addition to setting up a special needs trust for your loved one, there are other ways to protect them in your estate plan. They are as follows:

• Consider the fact that your loved one with special needs may require an estate plan of their own.
• Consider designating a majority of your assets to your loved one.
• Coordinate your family members’ estate plans with your own to further aid your loved one.

All in all, you should not go through this estate planning process alone. Instead, you should seek the support of one of the talented Butler County trust attorneys. We look forward to helping you.