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By: Sindee Smolowitz

As a parent I, like all other parents, worry about the needs of my child after I die.  As a parent of an adult daughter with special needs I perhaps worry even more than parents of typical offspring who likely will become completely independent. The same cannot be said for my autistic daughter, who depends upon me quite a bit for her financial, emotional, social and medical support and guidance.  I worry who will be there for her when I am gone? I worry who will advocate for her when I am gone? I worry how I can guarantee her some level of financial security for the remainder of her life?  I worry who will be sure that she is has a fulfilling and happy life?

These are worries that can be minimized dramatically with proper estate planning. Postponing making these plans only causes further worry and stress as parents of special needs offspring age.

Here are the elements of a properly drafted estate plan designed to provide for a special needs family member:

Your Successor Conservator or Advocate:   Identifying the person or persons who are capable of stepping in and stepping up to serve as an advocate for your child. This may be a close family member or friend or might be a professional familiar with the complex issues faced by special needs people. These issues include:

–        Assuring your family member is residing in the least restrictive, yet safest appropriate residential situation;

–        Interacting with the Regional Center if your family member is a Regional Center client to be sure he or she is receiving proper services;

–        Overseeing his or her mental, physical and dental health needs. This typically involves finding providers who accept Medi-Cal, Medicaid or similar insurance            under the Affordable Care Act who can deal effectively with whatever special needs your family member has.

–         Assuring your family member is receiving ongoing and daily vocational and social support as dictated by his or her abilities and interests.

The person you designate to undertake this role must be a willing participant and your planning advisor is a person you should be able to look to for options and recommendations. For example, many clients automatically assume their typical son or daughter will undertake the role as successor advocate. This may not necessarily be true and could very well be the very worse option depending upon that typical child’s particular life style, interests and temperament and his or her relationship with your special needs child. It is also a huge responsibility which many people are not up to.

The Special Needs Trust:   Special needs trusts are used to supplement government benefits received by people with special needs.  If people with special needs own too much property, they become ineligible for government benefits.  Special needs trust help your child with special needs avoid this problem because the trust owns the property instead of the person with special needs.  There are generally two types of Special Needs Trust. One you create and fund with your own property to help a loved one with special needs is called a third-party trust, and one that protects property that person receives directly through inheritance, a court settlement, insurance, or any other payment, which is referred to as a first-party special needs trust.

A third-party special needs trust is the typical type of trust used to benefit a person with special needs.  Commonly, family members create a trust for a loved one with special needs and leave property in the trust through their estate plan (their will, trust, life insurance, or other beneficiary designation). The trustee of the trust uses trust funds to support the person with special needs. When doing so, the trustee must carefully abide by trust requirements – trust funds cannot be used for anything that would make the beneficiary ineligible for benefits, such as cash gifts.  But the trustee may use trust funds for many other things, including classes, hobbies, luxury items, personal services, furniture, professional fees, computer equipment, pet supplies, transportation, and vacations. The beneficiary never owns the property in the trust and does not have direct access to trust funds. Sometimes, families with limited resources to devise to the family member will use a pooled special needs trust, which is managed by an independent fiduciary with the assistance of a designated advocate/representative for the beneficiary. Golden State Pooled Trust ( is one such established trust in California. Another such pooled trust which will be launched in the fall of 2016 is Jewish Los Angles Special Needs Trust (

Unlike third-party trusts, which are funded by property owned by someone other the beneficiary, a first party trust is established using the property of person with special needs.  A person with special needs might acquire property though a personal injury award, a retirement plan, a divorce settlement, life insurance proceeds, or inheritance devised to the special needs beneficiary directly and not to a special needs trust for his or benefits.  If a person with special needs owns any significant amount of property outright, it will affect eligibility for government benefits.  So instead of owning the property directly, the person with special needs puts the property into a first-party trust.  If the trust is created properly, adhering to strict government rules, those assets can be used to benefit the person with special needs without jeopardizing eligibility for government benefits. There are several variations of this type of trust all of which are subject to specific federal and state rules designed to keep applicants from sheltering their property in order to meet program eligibility requirements. They are also generally subject to “payback” rules that require that the state be reimbursed for medical expenses after the trust beneficiary dies.

Conclusion:    Clearly, planning for a loved one with special needs requires measured thought and good advice.  As I tell my clients all the time, the best way to show your love for your family is to make their lives as seamless as possible in the event of your death.  This is even more important for those families with a loved one with special needs. Contact Us for more information  here


Resolving Family Trust and Probate Conflict.

I have known Paul Velasco and his team for many years. Paul and Nicole Napalan have helped me with several plans regarding my future planning (health directives, etc.) and done a superb job. Their kind and thoughtful manner is exemplary.Additionally, Peter Sahin assisted one of my closest friends and his family develop a trust for his mothert. Everyone involved was pleased with the service and the resulting trust.When you want something done with care and compassion, Velasco Law Group is a law firm you can trust!

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Dave Dumalski


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