When you want to leave a gift to a child, family member or close friend who suffers from a disability, you must be careful. Listing someone with special needs as a beneficiary on a 401(k) or insurance policy is particularly problematic. A large lump-sum gift could disqualify the individual from continuing to receive Supplemental Security Income and/or Medicaid benefits. The individual is also unlikely to know how to handle a large sum of money.
Directing assets to a special needs trust can avoid this scenario. Assets held in a special needs trust are not considered for SSI and Medicaid eligibility. A trust allows you to bridge shortfalls between benefits your loved one receives and actual costs for necessities.
Mortellaro Law can help you set up a properly drafted trust and assist you to choose a trustee. Depending on your circumstances, this may be a family member and/or a corporate trustee.
Failure to have a will and trust can also lead to unintended consequences. Your disabled child could inherit a portion of your estate through Florida intestacy law that would affect eligibility.