If your child has special needs, there are many elements you must consider regarding his or her financial future. An important component of your child’s financial future is the inheritance you will leave for them.
Keep reading to discover more about how you can ensure your child with special needs receives a full inheritance.
How a Special Needs Trust Can Protect an Inheritance
By establishing a special needs trust for your child, you can protect their full inheritance as well as their Supplemental Security Income (SSI) benefits. There are a number of types of special needs trusts to choose from, including:
A first-party special needs trust can be a great solution for protecting your child’s inheritance. This type of trust allows the funding to come from your child’s own assets. Typically, there will be particular language included in the trust limiting the use of the account to certain costs that are not covered by government assistance.
A Minor Who Receives an Inheritance
If a minor child receives an inheritance in his or her name, the funds may be kept in a Uniform Gift to Minors Act (UGMA) account or Uniform Transfer to Minors Act (UTMA) account.
Money held in a UTMA account is considered an irrevocable gift, which means the assets cannot simply be transferred into another account. Instead, it is wise to use accounts like these to cover costs before your child reaches the age of eighteen. The money will be protected from Medicaid and SSI asset tests until your child reaches adulthood at which time they are not usually able to own more than $2,000 in assets and still qualify for SSI benefits.
We’re Here to Help
If you have more questions about how to protect your child’s inheritance, reach out to our team right away to learn more about what we can do to help.
Call Legacy Enhancement Trust today at (888) 988-5503 to learn how we may assist you!