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By: Scott Grossman on October 16th, 2016

Preserving a probate inheritance for a disabled child

Parents who used a will to pass their estate to their children want the best for their disabled child (adult). However, they often have not fully thought through how to protect the inheritance for their child. My firm recently helped a family through probate. The main beneficiary was the developmentally disabled 50-year-old son. The father drafted the will himself. He made a passing reference to his son being disabled and the need to protect his benefits.

Further Action for the Disabled Child

If nothing more was done, the disabled son would have received his inheritance and then been kicked off of public benefits (SSI and Medi-Cal in this case) because he would have been “over-resourced.” Rather than let this happen, the probate court was petitioned to create a special needs trust to hold the inheritance. This would allow the money to be spent on the disabled son while allowing him to keep his public benefits. The court found the father intended to do this and approved the creation of the special needs trust. Because this trust is treated as being created by the father is a “third-party” special needs trust and no payback to the state will be required when the disabled son dies.

If our petition was denied then the son, through his legal representative, would have had to petition the probate court for the creation of a “first-party” special needs trust. Under this scenario, the disabled son would keep his public benefits. However, when he dies the state will be able to assert a claim for money spent on his care.

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