If you have already established an appropriate special needs trust for your child, then congratulations! You've taken a wonderful step towards ensuring that your child can take maximum advantage of the government programs available for his/her needs, while also providing your child with security for all the things the government can't or won't provide. (If you haven't established a special needs trust yet, here are some reasons why it may be a good idea).
Having gone through this process, assisted by a qualified special needs planner, you may think that you've done your job to protect your child's benefits, and in most cases, you have done a great deal. However, if you are thinking about moving to another state with your child, or if your child has grown up and is moving to another state, beware. Provisions in your child's trust are almost always designed specifically for your current state of residence and may not work properly in the new home. Planning well in advance of the move will save you time, money, and a great deal of hassle, while helping to make your child's transition as seamless as possible.
If your family is moving to another state, you should immediately contact a qualified special needs planner in your future home state and discuss the steps you have already taken in regards to your child's needs. You should also talk with the attorney who drafted the original trust documents, and put that attorney in contact with your new special needs planner. The new planner will review the trust documents and let you know what, if anything, needs to change in order for the trust to function properly. Often, changing the trust can be as simple as executing a brief amendment or having the trustee sign off on slight changes. If your child's trust was established by a court, which often happens as part of a personal injury settlement, you may need to obtain court approval for any substantive changes to the document. Furthermore, you may have to transfer authority over the trust from the court in your current state to a new court in your new state.
While Supplemental Security Income (SSI) is a federal program with a uniform benefit rate, many states offer additional SSI payments to beneficiaries. Parents need to be aware that their child's benefit may be reduced or increased, depending on the state to which they are moving. Likewise, even though some types of Medicaid benefits (like emergency care) travel with your child's SSI benefits, other state-specific Medicaid programs, including all-important in-home care plans and other rehabilitative care, may not. In this case, your child will have to go through an additional application process in your new state, with different regulations regarding the treatment of your child's trust's assets.
The key lesson for any family or child choosing to relocate to another state is to plan well in advance. Utilizing a qualified special needs planner is the best way to familiarize yourself with your new state's programs and laws, and to ensure quality, ongoing care for your child.
This information is not intended to be a substitute for specific individualized tax, legal or estate planning advice as individual situations will vary. Neither Royal Alliance Associates, Inc., nor its registered representatives or employees, offer tax or legal advice. As with all matters of a tax or legal nature, you should consult with your tax or legal counsel for advice.
Securities and investment advisory services offered through Royal Alliance Associates, Inc. (RAA) member FINRA/SIPC. RAA is separately owned and other entities and/or marketing names, products or services referenced here are independent of RAA. Special needs consulting services are not offered through RAA.
Content provided by the Academy of Special Needs Planners, Copyright 2016