Parents are routinely told how important it is to have a plan in place in the event of their unexpected death. At the very least, this planning typically involves drafting a will, and implementing other legal tools as the circumstances dictate. Of course, parents of a child with special needs would want to draft a special needs trust to protect that child’s eligibility for public benefits. But, what about the tough situation where a young child has special needs, but the parents are not certain whether that child will grow up to require public benefits? Particularly given autism’s high incidence rate, this type of scenario is extremely common.
Parents who cannot foresee the needs that their child may have as he or she develops should not forego planning just because they do not know what the future will bring. In fact, that they do not know what the future will bring gives them even greater cause to plan. Of course, the catch here is that unless they know their child will someday rely on public benefits, they cannot be certain that a special needs trust will be necessary.
A solution to this dilemma might lie in what is called a discretionary trust. A discretionary trust gives the trustee authority to use the trust principal and income for any reason and for any amount for the beneficiary. So, by establishing a discretionary trust and drafting a good letter of intent, parents can instruct a trustee to use the discretionary trust funds to establish a special needs trust for their child if that child begins receiving public benefits.
In short, there is no reason why parents should forego planning for their child with special needs. In many instances, a special needs trust is the single most important document for a child’s sustained support. Parents should speak with a special needs trust attorney about their options if they are uncertain how to proceed.