Coming up next week is National Autism Day which was established to raise awareness about autism. Wear blue to show your support.
The incidence of autism is on the rise with approximately 1 in 110 children in the United States being diagnosed with the disease, according to the Center for Disease Control and Prevention. Autism is a developmental disorder which affects social and communication skills and sometimes motor and language skills.
From an estate planning perspective, here are come things to consider if you have a child with autism. Many people with autism receive government benefits. Failure to have a will or trust that incorporates a special needs trust or a stand alone special needs trust can jeopardize your child’s ability to receive government benefits when you die.
1. A Special Needs Trust. A special needs trust is one that is designed to manage inheritances and other resources while maintaining the child’s eligibility for such public assistance benefits as Medi-Cal and SSI. The trust is usually created by the parent, grandparent, or other person to benefit the beneficiary. If drafted properly, the SNT provides for benefits to the beneficiay without affecting their eligibility. The Trust holds title to the trust property rather than the child so the assets do not belong to the SNT beneficiary and the beneficiary can never be the trustee with any control over the assets. The Trust can provide for such needs as transporation, education, rehabilitation, medical appliances, computer equipment, and a higher degree of medical or dental care than what the beneficiary is getting through public benefits.
2. Be aware of cash bequests to special needs children. If grandparents or other family members want to help while they are still living, they cannot give the child a cash bequest because it might disqualify the child from receiving governmental assistance benefits. Custodian accounts set up in the child’s name can affect their eligibility for public assistance as can 529 Plans for their education. Making a special needs child the beneficiary of a life insurance policy can also affect the child’s eligibility. Therefore parents of special needs children need to alert family members who may be thinking of making gifts or making the child the beneficiary of their trust, IRA, or life insurance policy.
3. A Limited Conservatorship. A limited conservatorship is similar to a regular conservatorship but it is limited to reflect the needs of an individual who has developmental disabilities. California law provides that a limited conservator may be appointed for those individuals with developmental disabilities that prevent them from performing some tasks necessary for their personal needs or management of their finances. Autism is a condition that may make a limited conservatorship appropriate.
Watch for our next blog with more specific information about special needs trusts.