I have a disabled child on public benefits. What is a Special Needs Trust?
If you have a child who is disabled and receiving public benefits, you probably do not want to leave that child a large inheritance. If you do, he or she will be disqualified from public benefits until the money is spent, and then will have to reapply for such benefits as SSI or Medi-Cal. Instead, you will probably want to establish a Special Needs Trust. Under a Special Needs Trust, the portion of your estate that would otherwise be distributed to the disabled child will instead be managed by a successor trustee for the rest of the child’s life. The successor trustee will be instructed to use the funds to supplement public benefits, but never to give enough money to the child at any one time as to cause him or her to lose those public benefits. Thus, a gift of a portion of your estate can make life a little easier for the disabled child for many years after your death. Also, a carefully drafted trust contains further provisions designed to shelter those funds in case future changes in
