Estate Planning for Special Needs Families in New York

Caring for a loved one with special needs involves more than daily responsibilities. It also means thinking ahead, often years or decades into the future. Estate planning can help ensure long-term care, protect eligibility for essential benefits, and provide peace of mind for families across New York.

Why Traditional Estate Planning Isn’t Always Enough

Typical estate plans often fall short when applied to families with a loved one who has disabilities. Leaving assets directly to a person who receives Supplemental Security Income (SSI) or Medicaid can accidentally disqualify them from these vital programs. Even a modest inheritance can exceed income or asset limits.

Thoughtful planning provides a way to support loved ones financially, without disrupting their benefits. The right legal tools help families secure a safe and stable future.

Special Needs Trusts: Protecting Benefits and Enhancing Quality of Life

A Special Needs Trust (SNT), also called a Supplemental Needs Trust in New York, allows families to set aside funds for a person with disabilities. These funds can be used for extra expenses that improve quality of life, without affecting eligibility for income-based government programs.

First-Party Special Needs Trust

This trust uses the beneficiary’s own money, such as a lawsuit settlement or an inheritance. It must include a Medicaid payback provision, meaning remaining funds go to the state after the beneficiary passes away.

Third-Party Special Needs Trust

This trust is funded by family members or other loved ones. Because the money never belonged to the beneficiary, it doesn’t require Medicaid reimbursement. It’s often built into a parent’s estate plan or will.

Setting up the right kind of trust requires careful legal drafting and ongoing management to make sure it meets all legal and practical needs.

Why Wills and Guardianships Still Matter

Even with a trust in place, a will is still a cornerstone of an effective estate plan. It outlines how assets should be distributed and names a guardian for minor children or adult dependents who need oversight. Without a will, the court makes these decisions, and the result may not reflect the family’s intentions.

In New York, naming a guardian through a will ensures continuity of care. It lets parents choose someone they trust to take on the role of caregiver if they’re no longer able.

Wills can also direct assets into a Special Needs Trust rather than passing them directly to a beneficiary, preserving benefits and simplifying transitions.

Powers of Attorney and Health Care Proxies

Legal authority matters when decisions must be made. A power of attorney allows someone to manage financial matters on behalf of a person with disabilities. A health care proxy names someone to make medical decisions.

When completed early, while the individual still has capacity, these documents avoid the need for court-appointed guardianship later. In New York, these forms are recognized and can help prevent delays or confusion during medical or legal emergencies.

Coordinating with Government Benefits

Public benefits like SSI, Medicaid, and SNAP provide critical support. But eligibility is often based on strict financial limits. A misstep in estate planning can lead to disqualification and months of lost services.

To stay eligible:

• Avoid naming the person with disabilities directly on life insurance or retirement accounts

• Use a Special Needs Trust to hold gifts, inheritances, or settlements

• Regularly update plans to reflect changes in the law or family circumstances

With the right approach, families can offer support while keeping benefits intact.

Working with an Attorney Who Understands the Big Picture

Every family’s situation is different. A strong plan takes into account financial resources, care needs, benefit eligibility, and long-term goals. It also adapts to changes—whether in the law, family dynamics, or health conditions.

In New York, navigating these complexities means choosing legal support that understands both federal benefit programs and state-specific requirements. The right guidance can help ensure every element of the plan works in harmony.

Contact The Law Office of Mark J. Keller

Families navigating estate planning for special needs deserve clarity, compassion, and dependable guidance. With careful planning, it’s possible to protect loved ones, preserve critical support, and feel confident about the future.

The Law Office of Mark J. Keller works with families throughout New York to create thoughtful, legally sound plans that protect what matters most.

Call 718-297-1890

Email: markjkelleresq@yahoo.com

Or use the contact form at: markkellerlaw.com/contact-us