Special Needs Planning
Individuals with Special Needs
Planning for individuals with special needs often involves complex legal issues, such as tutorships, special needs trusts, continued care, and entitlement to government benefits.
Parents with special needs children are often responsible for taking care of all the child’s needs and deciding on that child’s financial and medical welfare, no matter the age. However, when a disabled child turns eighteen (18), that child is legally an adult--meaning that the law no longer grants parents the authority to act for that child, no matter how severely disabled the child may be.
In Louisiana, we have a procedure called a Continuing Tutorship, which applies to children who are over the age of fifteen (15) but under the age of eighteen (18) and who have a severe mental disability which results in that child having the mental capacity of a minor for the rest of their life.
Continuing Tutorship Steps
Once a parent brings an action for a Continuing Tutorship, the parent will retain the parental rights over that child, and those rights will not terminate when the child reaches the age of majority. If a Continuing Tutorship is not completed prior to age eighteen (18), the only way to retain the right to act on behalf of your disabled child is to file an Interdiction proceeding. The Interdiction process is adversarial and often very expensive.
If you have a special needs child older than fifteen (15) years of age who is severely mentally handicapped, you will need to begin the Continuing Tutorship process before the child’s eighteenth birthday to ensure that your parental rights will “continue” into adulthood.
Special Needs Trusts
Individuals with a disability often should not have cash or other resources in their name. This is true not only because they may not have the necessary resources to manage their property, but also because having assets over $2,000 will cause a disabled individual to lose their entitlement to needs-based government benefits such as Medicaid and SSI. By creating a Special Needs Trust, you will preserve the extra financial resources for the sole benefit of the disabled individual while maintaining their eligibility for government benefits.
If an individual receiving government benefits inherits from a parent or other individual outright or gets a personal injury award due to a claim for damages, you can create a Special Needs Trust to protect those resources. The Special Needs Trust ensures the financial resources will be preserved for the beneficiary, and managed by a Trustee who can disperse the funds for the benefit of the beneficiary, without any negative impact on the receipt of government benefits.
Testamentary Trust and Trustee
If you have a minor or disabled child, you will want to designate in your Last Will and Testament the name of the individual(s) whom you wish to have care and custody of your disabled child if you were to pass away. If your disabled child is not receiving government benefits, it is still important to create a Testamentary Trust and designate a Trustee who will be in charge of managing the child’s inheritance. You can also create a Testamentary Special Needs Trust if your child needs to maintain eligibility for government benefits.