Q: What kinds of things should we be aware of as we set up our estate for a disabled child?
A: The answer to that seemingly simple question is rather complex. To start, you should be considering setting up a couple of special needs trusts (SNT's). The first trust would be a 3rd party SNT, which is funded by assets owned by a third party (meaning not your child). The second trust is a "1st party" or "self-settled" SNT. This would be funded by assets of your child, which he or she might be entitled to because a relative left money to him or her directly, or by a personal injury settlement if your child became entitled to money down the road because of an accident.
These trusts will allow you to leave money for the benefit of your child, without jeopardizing entitlement to governmental benefits such as SSI.
I'd suggest sitting down with an estate planning attorney with expertise in this complicated area.
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