Learning that your child has Down syndrome can initially be overwhelming. However, the reality might be very different than anticipated. I am reminded of a client whose son had Down syndrome. After retiring, the father mentioned at dinner one evening that he was bored. His son volunteered that he could get him a job at the place where he worked. The next day the son’s manager called, stating that if he was as good a worker as his son, he would be delighted to hire him. This father observed that when his son was born he thought it was the end of the world. Now, 35 years later his son is finding him a job. However, optimism and success do not eliminate the need for planning.
Generally, estate planning in this area will involve making sure that anything left to your child with Down syndrome does not cause ineligibility for key government benefits which are based on the value of the assets your child owns. The most important of these benefits are Supplement Security Income, Medicaid, and state programs for adults such as those involving supported employment and housing. The national trend is toward self-directed services, meaning that instead of a placement, an annual budget is provided so that the family can make their own arrangements.
After your child with Down syndrome is born, you should establish a special needs trust to hold what you and other family members (e.g., grandparents) might leave when they pass away. Do not create a bank account or otherwise place assets into your child’s name. Unless there is a compelling tax reason, such trusts are not funded until death. An ideal way to ensure funding is to purchase life insurance, sometimes on the lives of both parents (joint survivorship). Grandparents wishing to help might pay the premiums. Not all special needs trusts are the same, and parents should make sure that they use an attorney who has both an estate planning background and also experience with the service system.
This is not something you should worry about now during your pregnancy. You can wait until after the baby is born to meet with an attorney. However, you may wish to advise friends and relatives giving monetary gifts when the baby is born that checks should be in your name, not the baby’s.
Making a plan for a special needs trust in no way presets your child’s future. However, it does protect against ineligibility for benefits your child may need some day. In the years following the creation of the special needs trust, you should keep in touch with your attorney to keep abreast of changes in the law or circumstances unique to your family which may require a second look at the plan.
Mr. Hinkle has represented people with disabilities since 1974. He is the founding partner of Hinkle, Fingles & Prior, PC with offices in New Jersey and Pennsylvania. Mr. Hinkle has served on the boards of a variety of non-profit organizations in the disability field. He is an adjunct professor of law at the Rutgers School of Law — Camden, teaching trusts, estates, and taxation. For more articles on related topics see the website of Hinkle, Fingles & Prior, PC.
See also: Finding Services chapter in our book, “Diagnosis to Delivery: A Pregnant Mother’s Guide to Down Syndrome.”