Special Needs Trusts and Guardianship

Posted by Sheri Tucker, M.S., J.D.Mar 23, 20230 Comments

Creating your estate plan is important for everyone.  Estate planning for a child with a disability is crucial.  Are you thinking about Guardianship? You should also think about a Supplemental or Special Needs Trust. What is guardianship? How is guardianship and special needs trusts related? When planning for a child with a disability what type of attorney is needed?

What is Guardianship of an Incapacitated Adult?

A Guardian of a minor or incapacitated adult makes decisions regarding the care, education, health, support, housing, and maintenance over the minor or incapacitated adult.  Missouri defines a Guardian as “a person appointed or qualified by a court to have care and custody of the person of an incapacitated person, whether denominated as general, limited or temporary guardian, or a person legally authorized to perform substantially the same functions.” MO Rev. Stat. 404.410 Definitions (Missouri Revised Statutes (2023 Edition))

If you are a parent of a child with special needs who lacks mental capacity, you may consider Guardianship of a Minor. When your child turns eighteen (18) years old, he or she is considered an adult.  As an adult, a parent loses the right to education and health information about their child, even one with a disability.  Not all children with a disability requires a Guardian. It's important to understand that alternatives to guardianship exists. When should a parent consider guardianship?

Who is an Incapacitated Adult?

Missouri law defines an incapacitated adult as “a person who is wholly or partially unable by reason of any physical or mental condition to receive and evaluate information or to communicate decisions to such an extent that the person lacks ability or capacity to manage his financial resources and is a disabled or incapacitated person as defined in section 475.010. MO Rev. Stat. 404.410 Definitions (Missouri Revised Statutes (2023 Edition))

The Probate Court determine guardianship. It is not automatic.

If the mental incapacity is severe enough, a parent may want to seek Guardianship over the child as an incapacitated adult. For example, children aging into adulthood with Asperger Syndrome may be severe enough for a parent to seek Guardianship.  However, an adult with Asperger Syndrome may function well in society and not need a guardian.  A child aging into adulthood with Down Syndrome may have intellectual capacity to stay their own guardian or may lack capacity to require a Guardian.  It's important to understand that not every child with a disability will require a Guardianship upon turning eighteen years of age.

What is a Third-Party Special Needs Trust?

A Third-Party Supplemental or Special Needs Trust (SNT) is an estate planning tool that helps provide a quality of life for a person with a disability. When you have a child with a disability, you should consider setting up a third-party special needs trust for your child. Parents may think, “Well, I'm the Guardian. Isn't that enough protection for my child?” The answer is no. 

Why is a Special Needs Trust Important?

Children aging into adulthood with a disability are outliving their parents because of better health care and quality of life. Guardianship is one step to make decision in health, care, education, support and maintenance of your child or incapacitated adult with a disability. That means, you the parent, will no longer be there to financially take care of your child. 

Guardianship alone is not sufficient for the needs of your child or incapacitated adult with a disability.

How does the SNT Provide a Quality of Life? 

By setting up a Third-Party Special Needs Trust, you allow beneficiaries to enjoy activities and have a quality of life. A parent may say well that's what I do as a Guardian. However, your child may outlive you. Then how is a qualify of life perserved? The SNT ensures that the individual with disabilities may maintain a high quality of life. Monies cover at-home care, material goods, enrichment activities, and health care expenses not covered by insurance.

Without a Supplemental Needs Trust, a person with a disability relies only on government benefits, which means living in poverty levels.

Many disabilities require various degrees of medical care, different home care, and family support. How does a special needs trust help a person with a disability? Often a person with a disability has high medical expenses or eventually needs to rely on government benefits. The Supplemental Needs Trust provides a quality of life and keeps a person qualified for possible future benefits. 

What are the other Benefits?

A properly drafted Supplemental Needs Trusts takes your worries into consideration. The SNT provides for a Care Manager and an Advocate for your child. Why is this important? If you were in a car accident today and unable to care for your child, who will advocate? By preparing for the future needs, you create a plan for today and tomorrow.

Your Estate Planning Attorney for Special Needs

There are many estate planning attorneys in the field. You need an attorney with experience in Supplemental Needs Trusts. It's important to work with an estate planning attorney who understands Special Needs Trusts and Guardianship issues.  Guardianship is an important process, but it should not be a stand-alone solution for parents.  To find out more, call 314-998-4223 or 314-332-0011. Book Now for your appointment.