Phoenix Special Needs Planning Lawyer

Why trust us with your special needs planning?

• 30 years of combined experience
• History of happy clients
• Devoted and passionate counsel
• Close attorney-client relationships

It is never too late to begin planning for the future! Call (602) 900-9860 for a case evaluation.

Tips on Special Needs Estate Planning in Arizona

While your child is a minor, be sure you and anyone caring for your child has signed appropriate directives that specify who should care for your child in the event you are unable to. You may also consider preparing legal documents that name a guardian for your child, again if you are unable to care for your child or in the event of your death.

Once your child is an adult and has the legal capacity to sign documents, that child should have their own set of advance directives naming a trusted agent.

Types of Special Needs Trusts

There are several types of special needs trusts. A First Party Special Needs Trust receives its funding from the special needs person as long as they are under 65. The funding mechanisms may be lawsuit proceeds, inheritance, or lump sum disability benefits. This trust can be established by the special needs child, parent, grandparent, or guardian and, when drafted properly, will not affect eligibility for the special needs person's government benefits.

A Third Party Special Needs Trust permits family members to use their assets to fund a trust to benefit a person with special needs without negatively impacting that person’s eligibility for government benefits. The funds in this trust type do not have a payback provision, allowing any remaining assets to pass to other beneficiaries as designated by the trustmaker and can be created during a lifetime or under the instructions of a will.

Finally, a Pooled Trust is a community trust that a non-profit organization manages to fund the needs of many special needs beneficiaries. In essence, the non-profit acts as a trustee and can be a good option for small families or those who seek non-family member trustees. The property held by pooled trust for the beneficiary should not affect eligibility for government benefits.

If you have a life insurance policy or are considering one, you can make the proceeds payable to your third party special needs trust. Leaving permanent and term life insurance policies to this trust type will not affect the child's government benefits. If you have retirement accounts, those may be payable to the third party special needs trust as well if there is a balance at the end of the account holder’s life.

It is not advisable to leave property for the care of your special needs child to a third party, such as another child. This third-party designate has no legal obligation to follow your wishes, leaving the use of your money to the discretion of that third party. As this type of arrangement is not legally enforceable, your child with special needs will be wholly unprotected after you die.

Create an Achieving a Better Life Experience or ABLE account. This type of account is not unlike the idea of the 529 College Savings Plan. An individual experiencing their disability before 26 years old can deposit up to $15,000 per year into their ABLE account. The account grows tax-free and can pay qualified expenses to maintain or improve quality of life. An ABLE account can also receive funds from parents, other family members, or friends who want to contribute to the account. Most government benefit programs are not affected by ABLE account funds.

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