Special Needs Trusts and Autism

Sam and Laura were delighted with the birth of their daughter Ella. The proud parents showed off photos and began making college fund contributions. However, as time went on, Sam and Laura became concerned about Ella’s delay in developing basic skills. At two years old, Ella was struggling with speech, engaging in repetitive behavior, and responding unusually to sensory stimuli. After enduring a gauntlet of testing from a variety of doctors, a diagnosis was made: Ella was autistic.
The diagnosis of autism in children has increased in recent years. In 2007, the Centers for Disease Control cited the rate of autism among children at 1 in every 150, an increase from previous estimates. In fact, the Department of Education (DOE) reports that the number of autistic children (aged 3-17) almost doubled from about 109,000 in 2001 to over 212,000 in 2005. A study by the University of California at Davis reflected an increase of 273 percent in California from 1987 to 1998.
The manifestation of autism varies from mildly impaired to severely affected. As a result, some children will see more specialists than others: speech and language therapists, occupational therapists, and doctors specializing in autism. Many parents have found public resources available for autistic children to be scarce if not completely insufficient. Children who are severely impacted by autism may find themselves struggling with the disorder onward into adulthood and, thus, unable to live in an independent environment and requiring assistance with daily tasks.
One way to assure a child with autism receives the best care available is to establish a Special Needs Trust for the child. A Special Needs Trust ensures that its beneficiary receives the benefit of assets transferred to the trust, while permitting the beneficiary to retain access to public government resources. Parents do not need to wait until their child turns eighteen before setting up a Special Needs Trust. Once the trust is established, the parents can place funds in the trust and the funds can be used immediately or stored for future use.
Under the terms of a Special Needs Trust, a Trustee manages the trust property to make certain it will last for the lifetime of the beneficiary. The Trustee has discretion to make distributions to the beneficiary for supplemental expenses that are not covered by government sources. Because the child is only a beneficiary, the child is not considered the owner of the trust property and still will qualify for resources provided by the government.
By setting up a Special Needs Trust, parents can be reassured their child will be taken care of. The Special Needs Trust is meant to supplement rather than replace government benefits. It provides the beneficiary with sufficient support to live life with more than just the basics provided by government benefits.
Mr. Davidov is engaged in the practice of law exclusively in estate planning, Elder Care, Special Needs Planning and Estate Administration. He is a member of the American Academy of Estate Planning Attorneys. For more information or to attend an upcoming seminar, call 718-793-7000.