Let’s face it, as parents of children with autism and ADHD, we worry about our kids’ futures. Autism hits families hard financially. We want to ensure they are cared for if we are not around. Some of our high-functioning kids will live independently and do the whole “adulting” thing in their own way. For others who are lower on the spectrum, we want to be sure they have the means as the adult. So when do you need a special needs trust fund for your autistic child?
This is something I’ve been thinking about more and more as our son J gets older. He is high functioning, and I think he will be able to live independently. Yet, given the statistics around unemployment for those on the spectrum, I am concerned he may need more help. Researching special needs trust funds is something I’ve needed to do for a long time. Therefore, I am happy to share what I’ve found with you.
Types of special needs trust funds
There are three types of special needs trust funds. Those include:
- First Party or Self Special Needs Trust Fund – This type of fund is created by assets owned by the person who has autism, and they are the beneficiary. These could be from an inheritance or another event such as a personal injury settlement. The fund must be created when the person is under 65 years of age and is considered irrevocable or cannot be changed. When the person dies, payment to Medicaid is required before distribution to anyone else.
- Third Party Special Needs Trust Fund – This fund is created by assets owned by someone else other than the person with a disability, such as a parent, grandparent or other person. This can be established either during the creator’s lifetime or as a part of their will. It is managed by someone other than your child, and it’s not considered their asset. That means they remain eligible for government assistance that requires them to have limited assets. This type of fund does not have to pay Medicaid upon the beneficiary’s death. Instead, the remaining funds can be distributed to whomever the creator designates.
- Pooled Special Needs Trust Fund – This type of fund is usually run by a nonprofit organization that acts as the trustee. For this fund, the organization “pools” assets from many different people into a master trust, and then it manages sub-trusts for the various beneficiaries. This type of trust can be helpful for those who do not have many assets to set up a trust individually for their child. This trust type also requires Medicaid to be paid first upon the beneficiary’s death.
Benefits of special needs trusts
While you are able to care for your child, you are able to help provide and pay for the extras your child needs. That includes education programs, therapies not covered by Medicaid, or other assistance. But after you are gone, your child may not be able to fund those on their own if they cannot live independently and is relying on government and other assistance.
The benefits of a special needs trust for your autistic child include:
- Protecting your child’s financial assets from others who may misuse them.
- Providing additional assets available to them to pay for therapies and other living expenses not covered by government assistance. Most government programs require participants to have no more than about $2,000 in assets to qualify. That isn’t much. While those programs will cover the basic costs of living such as housing subsidies, food and medical care, it doesn’t cover anything else.
- Enjoying the peace of mind knowing that your child will have additional money available for transportation, self-care, education, entertainment, caregivers and more that will provide them a higher quality of life.
- Knowing that you are not putting an extra burden on your other children or family members to provide for your child once you are no longer able to do so.
- Protecting the assets of your child by placing them within the trust.
Money needed to fund the trust
So where does the money come from? It could be assets that you already own that you place into your funds. You could form it through your estate upon your passing. Many times, people use life insurance policy payouts after they pass as the assets for the trust.
How you start a special needs trust fund
To establish a special needs trust fund for an autistic child, you need to work with a lawyer in your area that specializes in these types of funds. The lawyer will walk you through the process such as writing a letter of intent for your child and setting up the trust fund itself.
To find an attorney near you, check out the Special Needs Alliance’s “Find an Attorney” directory.
Have you already set up a special needs trust fund for your autistic child? If so, what advice do you have for others? Leave a comment to share with and encourage other parents and caregivers who are on this journey.
FAQs
Along with autism, cerebral palsy, hearing loss, intellectual disabilities, learning disabilities, vision impairment and others, ADHD is also considered a developmental disability.
What are the disadvantages of a special needs trust? ›
Cons of Special Needs Trusts
The trust must be maintained, and yearly management costs can be high. Depending on who manages the fund, there may be a minimum amount required to set up the trust. It may be financially difficult for the settlor to actually establish the trust, depending upon their circ*mstances.
What happens when a child is diagnosed with autism and ADHD? ›
People who have traits that stretch across both autism and ADHD diagnoses often face more serious challenges than people with either diagnosis alone: They can have greater impairments in adaptive functioning, a term that refers to self-care and daily living skills, and more severe social and cognitive issues.
What is the difference between a special needs trust and an ABLE account? ›
The money in SNTs is to pay for “extra” expenses that are not covered by public benefits. You can use the money in an ABLE account for a much broader range of expenses, including the basic costs of living, education, food, employment, and transportation.
What money can you get for a child with autism? ›
The maximum SSI benefit amount for a child with autism in 2021 is $794 per month, but the actual benefit amount may be less depending on the child's circ*mstances.
What is a child with autism entitled to? ›
Key benefits include Disability Living Allowance (DLA) for children, Personal Independence Payment (PIP) for adults, Carer's Allowance, and specific provisions within Universal Credit.
What are alternatives to special needs trust? ›
Alternatives to opening a trust include spending down the funds, prepayment of living expenses and ABLE accounts. Read below for more information on each.
What are the advantages and disadvantages of a special needs trust? ›
Pros & Cons of a Special Needs Trust
| Pros | Cons |
|---|
| Funds are tax-deductible | Funds must pay back Medicaid after the beneficiary's death |
| Funds can't be collected by creditors or for judgements | Funds can only be used for limited services, not including food or housing |
1 more rowAug 16, 2022
Complex structure. Restrictions in the trust deed on trustees' powers. Expense in establishment and maintenance.
What is ADHD and autism together called? ›
The characteristics of these neurotypes overlap in surprising ways. Amy Marschall, PsyD. Amy Marschall, PsyD. Dr.
The alpha agonists used for ADHD and in children with ASD include guanfacine (Intuniv, Tenex) and clonidine (Kapvay, Catapres). These medications have been used not only for the treatment of ADHD in youth with ASD, but also for associated motor/vocal tics, aggression, sleep disturbances, and behavioral dysregulation.
Can a child be both autistic and ADHD? ›
According to the scientific literature, 50 to 70% of individuals with autism spectrum disorder (ASD) also present with comorbid attention deficit hyperactivity disorder (ADHD). From a clinical perspective, this high rate of comorbidity is intriguing. What is the real significance of this dual diagnosis?
Can you buy food with an ABLE account? ›
The savings in an ABLE account may be used tax-free on a variety of qualified disability expenses (QDE) such as housing, food, transportation, assistive technology and more.
What are the disadvantages of an ABLE account? ›
The disadvantages to these accounts are as follows:
- Medicaid Payback. There is a Medicaid payback from the account on funds remaining in the account on the death of the designated beneficiary.
- Contribution Limit. ...
- Prior to Age 26. ...
- Asset Cap. ...
- Loss of SSI Benefits. ...
- Qualified Disability Expenses.
A SNT can disburse up to the annual ABLE contribution limit directly into a beneficiary's ABLE account for these qualified disability expenses that exceed the monthly SSI benefit. SNT beneficiaries can use their trust and ABLE account together to minimize fees and grow funds tax-free through ABLE investment options.
What is it called when you have both autism and ADHD? ›
AuDHD: When Autism and ADHD Co-Occur.
Is ADHD technically a disability? ›
Yes, ADHD is considered a disability under the Americans with Disabilities Act (ADA) and the Rehabilitation Act of 1973 (Section 504).
Does ADHD qualify as a disability? ›
Is ADHD a Disability? Yes. Whether you view attention deficit hyperactivity disorder (ADHD) as neurological — affecting how the brain concentrates or thinks — or consider ADHD as a disability that impacts working, there is no question that the federal Americans with Disabilities Act (ADA) covers individuals with ADHD.
Is a ADHD considered a disability? ›
ADHD is considered a developmental disability, not a learning disability. Accommodations can often be made in the classroom or work environment to help people with ADHD be more successful. If symptoms are severe, a person with ADHD might qualify for federal benefits, but this is determined on a case-by-case basis.
