Estate Planning When a Family Member Receives SSI
by Linda Ershow-Levenberg, Certified Elder Law Attorney (C.E.L.A.)
February 2012; updated August 2020
The parents of a young adult who cannot work due to severe disabilities can assist him or her to file for Supplemental Security Income (SSI). This is the path to take if the parent or parents are still employed.
Estate Plans & SSI
Since the SSI recipient cannot be the owner of assets, special estate planning strategies should be considered. The parent can engage an attorney and create a Special Needs Trust, also called a “d4a” Trust, and the child can transfer his or her assets into the Trust. This is one way to assist the child to meet the financial criteria for SSI. If the parents are the legal Guardian of the child, they can petition the court for permission to transfer the child’s assets to such a trust. If the child is a minor but is incapacitated, the parents should consider filing for Guardianship once the child reaches age 18.
Supplemental Benefits Trusts
The parents would also want to consider creating a Supplemental Benefits Trust, either in their Last Will and Testament or as a third-party stand-alone trust, if the child receives SSI benefits. In this way, the inheritance would be placed in the Trust and the child would not lose his or her SSI and Medicaid benefits.
Many issues will require careful consideration, including the choice of trustee, what to do about a place for the child to live, and the amount of money to be placed in this Trust.
To make an appointment or speak to an attorney about estate planning to protect disabled heirs, and Special Needs Trusts, call 732-382-6070 or contact us online.