Statistics reveal that about 16% of children in the United States have some sort of disability. The concerns of parents of these children are the same for most any parent and that is to make sure that their children are safe, happy, and live a meaningful life.
Some of these children may not be able to earn a living on their own. Both the federal and state governments understand this and provide benefits for these children, so that they receive food and shelter and medical care. Many of these benefits are “means tested”, meaning that the child cannot have much in terms of assets and cannot make much in terms of income, and if the child inherits assets from the parents, these benefits will discontinue, and the child must use up all of the inheritance before having to reapply for benefits.
This leaves parents to think that they must disinherit their children so that they can continue to receive benefits or entrust another family member to manage money for the benefit of the child.
The better alternative is the Supplemental Needs Trust. Properly written and administered, this trust allows parents to leave the child their inheritance and allows the child to continue to receive the much needed governmental benefits. This Supplemental Needs Trust is written instructing the trustee to pay assets from the trust for the benefit of the child only over and above what the child receives from the government.
This partnership between the federal and state governments and the parents allow the child to live the most meaningful, happy, and independent life possible.
Stephen B. Yim, Attorney at Law | 2054 S. Beretania St., Hon. | (808) 524-0251 | stephenyimestateplanning.com