A comprehensive estate plan is important to both you and your loved ones. However, this is even more so the case if you want to include someone in your estate plan who has special needs.
In addition to concerns about how to best care for them after your passing, you may also have questions about the best way to leave them your assets.
It’s your hope that you settle on a plan for providing your loved one with the care they need for as long as it’s required. But if you don’t know exactly what you are doing, you could jeopardize their eligibility for government programs such as Medicaid and Supplemental Security Income (SSI).
Direct Gifting is Typically the Culprit
While there are many areas of concern, direct gifting is something that deserves extra attention.
Here’s why: when it comes to government programs that provide health care and financial assistance, your loved one’s income and resources are taken into consideration.
And that’s why direct gifting is a concern. Here’s how we explain it on our website:
Giving your child money or assets while you are alive could lead to disqualification. Likewise, leaving direct gifts to your child in your estate plan could also cause your child to lose his or her eligibility for assistance. The solution can be found in Special Needs Planning strategies that are incorporated into a comprehensive estate plan.
So, while you think you’re doing what’s best for your loved one, you’re actually increasing the likelihood that they’ll no longer be eligible for the benefits they rely on.
Fortunately, there’s a solution to this problem: a Special Needs Trust.
With this, you can designate assets to be used for specific expenses, such as regular care, without gifting them directly to your loved one. This allows them to take advantage, all without the risk of losing eligibility for state and federal assistance.
If you’re concerned about special needs estate planning, contact us to learn more about your options. We can review your circumstances, answer your questions, and help you create the perfect estate plan for you and your loved one.
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