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Life Insurance Can Help Fund a Special Needs Trust

Parents whose children include a special needs child have a unique estate planning challenge. They are often torn between wanting to leave an equal legacy to all their children and knowing that their special needs child will probably need more financial assistance than their other children. One solution to this challenge is to set up a special needs trust for their special needs child (a third party special needs trust) and fund it with life insurance.

It is important that the special needs child receive an inheritance from his or her parents in a special needs trust rather than as an outright distribution. An inheritance received in a special needs trust will not interfere with the government benefits that the special needs child depends upon but an inheritance received outright may very well cause the child to no longer be eligible for government benefits.

Once the parents set up the special needs trust as part of their estate planning, they can look to life insurance as a source of money to fund the special needs trust upon their death. This way, the special needs child can receive the extra money they typically need over their lifetime and the other children can still receive an inheritance from their parents.

So, if you have a special needs child, a discussion with your estate planning attorney, as well as your insurance agent about the various ways life insurance can be used to fund a special needs trust for your child may be the answer for your unique estate planning challenge.

  • Why Choose
    Our Firm?

    We limit the number of clients that we have at one time, allowing us to focus on your case.

    Personalized Representation
  • Know the
    Benefits

    Find out if you and your family can benefit from our elder law planning services!

    More Information
  • Dedicated & Experienced

    Our firm exclusively handles elder law concerns so your family can obtain peace of mind.

    Meet Your Attorney
  • Complimentary Consultation

    Let us help. Request your consultation today and we will be in touch.

    Contact Us Now

Contact Us

Edwards Elder Law, P.A.
St. Petersburg Elder Law Attorney
Located at: 2510 1st Ave. N.,
St. Petersburg, FL 33713
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Phone: (727) 755-5808
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The information on this website is for general information purposes only. Nothing on this site should be taken as legal advice for any individual case or situation. This information is not intended to create, and receipt or viewing does not constitute, an attorney-client relationship.