Parents and grandparents naturally want to provide financial security for the people they love. For many families, that means leaving an inheritance to children or grandchildren through an estate plan.
However, if your loved one has a disability or special needs, leaving money directly to them could unintentionally jeopardize important government benefits.
That’s why special needs planning is an essential part of estate planning for many Missouri families.
Quick Answer
If your child or loved one receives—or may one day qualify for—government benefits such as Supplemental Security Income (SSI) or Medicaid, you should not leave an inheritance directly to them without first consulting a special needs planning attorney in Missouri. Proper planning can help preserve eligibility for benefits while enhancing your loved one’s quality of life.
What Is Special Needs Planning?
Special needs planning is the process of creating legal and financial strategies that protect a person with disabilities throughout their lifetime.
It allows families to:
- Preserve eligibility for government benefits
- Provide additional financial support
- Improve quality of life
- Protect inheritances
- Plan for future caregivers and trustees
- Create long-term financial security
Special needs planning can benefit individuals with:
- Intellectual or developmental disabilities
- Autism spectrum disorder
- Cerebral palsy
- Down syndrome
- Mental health conditions
- Traumatic brain injuries
- Certain physical disabilities
- Other long-term conditions affecting independence
Why Leaving an Inheritance Can Create Problems
Many public assistance programs have strict income and asset limits.
If a parent or grandparent leaves money directly to a person receiving means-tested benefits, that inheritance could reduce or eliminate eligibility for programs such as:
- Supplemental Security Income (SSI)
- Medicaid
- Supplemental Nutrition Assistance Program (SNAP)
- Other needs-based government assistance
Even well-intentioned financial gifts can have unintended consequences if they aren’t properly planned.
Because benefit rules change over time, it’s important to work with an attorney who stays current on federal and Missouri regulations.
How Families Can Help Without Jeopardizing Benefits
Fortunately, there are legal planning tools that allow families to provide financial support while helping preserve government benefits.
The right strategy depends on your loved one’s unique needs, age, financial circumstances, and long-term goals.
Two of the most common planning tools are Special Needs Trusts and ABLE accounts.
Special Needs Trusts
A Special Needs Trust (SNT) is one of the most effective ways to provide financial support for a person with disabilities without giving assets directly to them.
Assets placed into the trust are managed by a trustee who is responsible for:
- Investing trust assets
- Managing distributions
- Following trust instructions
- Keeping appropriate records
- Protecting the beneficiary’s long-term interests
Because the trust—not the beneficiary—owns the assets, a properly drafted Special Needs Trust may allow the beneficiary to remain eligible for certain government benefits while still receiving financial assistance.
Trust funds may often be used for expenses that improve quality of life, including:
- Education
- Therapy
- Medical expenses not covered by insurance
- Transportation
- Recreation
- Personal care services
- Technology
- Adaptive equipment
- Travel
- Other supplemental needs
Because distributions can affect benefit eligibility, trustees should understand the applicable rules before making payments.
ABLE Accounts
An ABLE (Achieving a Better Life Experience) account is another valuable planning tool for many individuals with disabilities.
ABLE accounts allow eligible individuals to save money for qualified disability expenses while offering certain tax advantages.
Depending on current federal and state rules, funds may generally be used for expenses such as:
- Housing
- Education
- Transportation
- Healthcare
- Employment support
- Assistive technology
- Financial management
- Personal support services
Unlike a Special Needs Trust, the individual with the disability owns the ABLE account.
For some families, this provides greater flexibility. For others—particularly when a loved one may be vulnerable to financial exploitation or unable to manage money independently—a Special Needs Trust may provide stronger long-term protection.
Many families benefit from using both planning tools together.
Should You Choose a Special Needs Trust or an ABLE Account?
There isn’t a one-size-fits-all answer.
Factors to consider include:
- The individual’s age
- Their ability to manage finances
- Current government benefits
- Future eligibility for benefits
- Size of the inheritance
- Family goals
- Long-term care needs
An experienced special needs planning attorney in Missouri can help determine which strategy—or combination of strategies—is most appropriate.
Estate Planning for Families with Special Needs
If your estate plan names a loved one with disabilities as a beneficiary, it’s important to review your documents regularly.
A comprehensive estate plan may include:
- A Last Will and Testament
- Revocable Living Trust
- Special Needs Trust
- Powers of Attorney
- Beneficiary designation review
- Guardianship or conservatorship planning, when appropriate
Proper planning helps ensure your loved one’s financial future remains protected without unintentionally affecting important public benefits.
Work with a Missouri Special Needs Planning Attorney
Special needs planning involves a complex combination of estate planning, public benefits law, trust administration, and long-term financial planning.
At Beck, Lenox & Stolzer Estate Planning and Elder Law, LLC, we help Missouri families create customized plans that protect loved ones with disabilities while preserving eligibility for essential government benefits whenever possible.
Whether you’re creating your first estate plan or updating an existing one, our team can help you develop a strategy tailored to your family’s unique circumstances.
Contact Beck, Lenox & Stolzer Estate Planning and Elder Law, LLC today to schedule a consultation and learn how special needs planning can help protect your loved one’s future.
Reference: The Sentinel (Nov. 20, 2020) “Planning for loved ones with special needs”