Special Needs Trusts Can Help Children With Addictions

Suppose you are a parent with children close in age but one is addicted to alcohol or drugs.  People can check this hyperlink, if they need the best alcohol or drug abuse treatments. You have tried, over the years, to encourage rehabilitation but have generally been unsuccessful.  He may have even served time in prison.  You may have been out of touch for long periods and then he or she resurfaces in time to ask for more money.  You are deeply concerned that more funds will simply be used to feed his or her habit.  You struggle not knowing whether you are the last hope to stay alive or the one person who needs to say “no” so that his disease might be brought under control.

It is difficult enough to deal with these problems while you are alive and actively involved in decision making.  Your next concern is that, on your death, or on your spouse’s death if you die first, an open-ended inheritance squandered on  addiction is the last thing that your child should be receiving.  He or she, as an addict, could waste the inheritance early and might even kill himself or herself in the process. You can also visit this website to know more about issues that causes drug addiction.

Does Equal Inheritance and the Same Distribution Make Sense Under the Circumstances.  Many parents assume it is necessary to treat all children who inherit equally and to distribute in the same way and that they have no reasonable alternatives in estate planning when it comes to drug or alcohol addicted children.  This is not true.

With some additional thought and planning, you can establish a strategy to continue in your absence.  It might need revisions over time but you can begin now to anticipate and face a likely future so that, on your death, your Will contains a structure to deal with your addicted child.  The important point is that you decide how the funds are to be distributed. You can get help here from professionals on how to deal with addiction problems. Or you may consider visiting Alcohol and Drug Rehab Los Angeles for treatment.

Leaving Funds to One Child With the Assumption That He Will Care for Another May Not Be the Best Route.  Consider a Trust Instead.  

Some parents might leave additional funds to a “healthier” child as an alternative to setting up a trust under their Wills.  This might not be the best decision.

If the healthier child is married or combines this inheritance with other assets in a joint account, the funds intended for the addicted child could be lost.

Also the healthier child and the addicted child could become estranged.  The healthier child receiving the inheritance could himself die leaving the funds to his own estate or have creditors.

Finally, there are no rules and there is no structure in place.  The addicted child might pursue the child who received the inheritance with the same insistence that was used in pursuing you.

What a Trust Under Will Can Do For a Drug or Alcohol Addicted Child.

When you include a Trust in your Will for your drug or alcohol addicted child, you can write the rules as to how much, when, and under what circumstances funds will be received and you name the Trustee.  For instance, you can say that, when your child is under a disability or in active addiction, no funds will be distributed except for drug or alcohol rehabilitation and all the related medical expenses.

You can name either an individual Trustee such as a family member or an institutional Trustee such as a Bank Trust Department or you can name both to act jointly.

You can specify that the Trustee will have sole discretion to decide whether your child is in a period of disability and allow the Trustee to require drug and alcohol testing as a condition for receiving funds from the Trust.

You can state that payment will be made only to providers such as landlords or educational institutions so that the funds are never actually received by your drug or alcohol addicted child but only by the people providing them lodging or services.

Although this is not the subject of this column, children who are regarded as “special needs” such that they would receive government funds can also be beneficiaries of supplemental needs trusts in your Will, thereby preserving their benefits and children who might squander money can have a “spendthrift trust”.

You can write the rules as to how inheritances are to be received and, if so. receive specialized assistance how to do this.

About the Author Janet Colliton

Esquire, Colliton Law Associates, P.C. Janet Colliton has practiced law for over 38 years, 37 of them in Chester County, Pennsylvania, a suburb of Philadelphia. Her practice, Colliton Law Associates, PC, is limited to elder law, Medicaid, including advice, applications and appeals, and other benefits planning including Veterans benefits, life care and special needs planning, guardianships, retirement, and estate planning and administration.

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