Special Needs
Protect benefits • Support quality of life
Special Needs Planning
Families caring for a loved one with disabilities often share a common fear
If we leave money outright, will it jeopardize benefits?
In many cases, yes. That’s why special needs planning is about structure—ensuring meaningful support without unintentionally disqualifying eligibility for needs-based benefits like SSI and Medicaid.
Goal
Create a plan that supports your loved one for the long term while protecting the benefits and resources your family relies on.
Why Structure Matters
Even well-intended gifts or inheritances can cause problems if they are received outright. Common issues include:
- Benefit disruption or re-qualification headaches
- Funds being held or mishandled without proper oversight
- Family conflict over “who should manage what”
- Uncertainty about how money should be used over time
Common mistake
Leaving assets directly to a beneficiary who receives needs-based benefits—without a plan to protect eligibility.
What Special Needs
Planning Can Accomplish
- Preserve eligibility
Design planning around needs-based programs so your loved one can continue receiving SSI/Medicaid (when applicable) while still benefiting from family support. - Choose the right trustee and oversight
Establish a long-term management plan with a trustee who can administer funds responsibly and consistently over time.
- Support quality of life
Provide resources for “supplemental” needs—care, therapies, education, transportation, activities, and other quality-of-life items that benefits may not cover. - Coordinate family gifts and inheritances
Align how parents, grandparents, and other relatives give support so good intentions don’t accidentally create benefit problems.
Peace of mind matters. Special needs planning is not just about compliance—it’s about reducing worry and creating a stable, sustainable support system.
What the Process
Typically Looks Like
Special needs planning begins with understanding your loved one’s unique circumstances and how your estate plan can provide meaningful long-term support. From there, we design and coordinate a plan that protects the inheritance you leave for them while preserving access to important benefits whenever possible.
- Understand the Beneficiary’s Needs
We begin by understanding your family member’s circumstances, including the nature of the disability, current or anticipated government benefits, available resources, and your goals for providing long-term support. - Design the Special Needs Plan
We determine how a special needs trust should fit within your overall estate plan, including who should serve as trustee, how the trust should be funded, and how inheritances and other assets should be structured to provide for your loved one without unnecessarily jeopardizing eligibility for means-tested benefits. - Coordinate the Plan
A special needs trust works best when the rest of the family’s planning is coordinated with it. We provide guidance on beneficiary designations and other planning considerations so that life insurance, retirement accounts, inheritances, and other assets intended for the beneficiary are directed appropriately.
Frequently Asked Questions
Can an inheritance affect a beneficiary's eligibility for SSI or Medicaid?
Yes. Certain government benefits, including Supplemental Security Income (SSI) and Medicaid, are means-tested. An outright inheritance or certain other transfers to a person receiving those benefits can potentially affect eligibility.
Special needs planning is intended to coordinate the family’s estate plan with applicable benefit rules so that an inheritance can provide additional support without unnecessarily disrupting important benefits.
What is a special needs trust?
A special needs trust is designed to hold and manage assets for the benefit of a person with a disability while preserving eligibility for certain means-tested government benefits when the applicable requirements are satisfied.
Rather than giving assets directly to the beneficiary, the trust is administered by a trustee who can use trust assets for the beneficiary in accordance with the terms of the trust and applicable benefit rules.
What can a special needs trust pay for?
Depending on the type of trust and the benefits the individual receives, trust assets may be used to enhance the beneficiary’s quality of life and pay for goods and services not otherwise provided by government benefits.
Because certain distributions can affect eligibility or benefit amounts, the trustee should understand the applicable rules and administer the trust carefully.
Who should serve as trustee of a special needs trust?
The trustee should be someone capable of managing money responsibly, understanding the beneficiary’s needs, following the terms of the trust, and complying with rules affecting government benefits.
Depending on the circumstances, families may choose a trusted individual, a professional or institutional trustee, or an appropriate combination of fiduciaries.
Can grandparents or other relatives leave assets to a special needs trust?
Yes, when the planning and beneficiary designations are structured appropriately. Coordinating gifts and inheritances from parents, grandparents, and other family members can help prevent well-intentioned transfers from inadvertently disrupting the beneficiary’s eligibility for means-tested benefits.
Family members should therefore understand how their own estate plans and beneficiary designations fit with the special needs plan.
Should I name a special needs trust as beneficiary of life insurance or retirement accounts?
In appropriate circumstances, a properly drafted special needs trust may be incorporated into beneficiary planning for life insurance, retirement accounts, and other assets.
The correct beneficiary structure depends on the particular asset, the terms of the trust, tax considerations, and the beneficiary’s circumstances. Beneficiary designations should therefore be coordinated with the estate plan rather than completed in isolation.
Tell Us About Your Situation
Use our contact form to share a few details about your family member’s circumstances and your special needs planning concerns or goals. Our office will review your message and follow up regarding appropriate next steps.