The Denver metropolitan area is a fantastic place to raise a child who has a disability. Whether your child takes advantage of services in Wheatridge or somewhere else along the Front Range, he or she undoubtedly benefits from the medical professionals who live and work in Colorado.
As your child ages, he or she may be eligible for means-tested government benefits, especially if the young one in your family is never able to work. Leaving assets to your child, though, may render him or her ineligible for public help, as your gift may push your son or daughter over the income limit.
A legal workaround
When you are planning your estate, you may want to think about setting up a special needs trust. With this approach, you name a trustee to hold funds for the benefit of your child without transferring ownership of assets to your son or daughter.
As a result, your child may use disbursements from the trust without losing eligibility for means-tested government benefits.
Acceptable disbursements
Government financial assistance usually only covers ordinary living expenses and basic medical care. Your child may not use disbursements from the special needs trust on these expenses or anything else government programs traditionally cover.
Nevertheless, your child may access the special needs trust for supplemental expenditures, likely including the following:
- Education and training
- Travel
- Hobbies
- Home renovations
- Uncovered medical care
- Personal assistance
While government funds are often meager, they may make a considerable difference in your child’s ability to thrive after your death. Still, by setting up a special needs trust, you ensure your son or daughter has a better quality of life.