Klenk Law

Equalizing Siblings Inheritances With A Special Needs Child.

Posted on Wed May 4, 2016, on Special Needs Estate Planning

From our “Ask a Question” Mailbag: Equalizing Siblings Inheritances With A Special Needs Child.

Most Recently Updated August 6, 2018.

“My estate is only large enough to provide care for my Special Needs child.  So how do leave an equal amount to my other two sons? Is there a way to equalize inheritances with a special needs child with siblings?”

Equalizing Siblings Inheritances With A Special Needs Child

Equalizing Siblings Inheritances with a Special Needs Child When Assets are Limited.

Balancing inheritances for children when there is a dependent, Special Needs child, can be complicated. Though you wish to treat your kids equally to prevent resentment, the idea of dividing your estate can be agonizing if you are not sure how much will be needed to provide care for your Special Needs child.

Review the Special Needs Trust Remainder Provisions.

First, make sure that at the Special Needs Child’s death any remainder stays in the family.  This result is good whether the estate will be divided or placed entirely into the Special Needs Trust.  If set up correctly, the assets that remain in the Special Needs Trust at your child’s death can pass to the other kids free of any debts the child may have.  These assets can pass outright, or they can be in protective trusts sheltered from your children’s spouses and creditors. Though they will have to wait, this at least provides the other kids a chance of inheriting.

Include All Children in a Pooled Trust.

Another possibility is providing the other kids with a small amount over the term of the Special Needs Trust. Again, if set up correctly, your estate could be held in trust for all your children.  The words can be crafted to limit any distributions to the Special Needs child to Special Needs Trust provisions.  You can then allow the trustee to distribute some assets to the other kids.  For example, a specific amount each Christmas.  These distributions can be obligatory or in the trustee’s discretion.  There are many options.  If this idea appeals to you, we can brainstorm for the terms that best suit your situation.

Consider an Irrevocable Trust.

I will need more information about your assets, but one answer is to form an Irrevocable Life Insurance Trust with Special Needs Provisions.  This trust then purchases a life insurance policy on your life. At your death, this life insurance will be outside your taxable estate and unavailable to your creditors. Further, even if your property is entangled in a lawsuit (say you die in a car accident), within a few weeks after your death, the Trustee can collect the life insurance and use those funds to provide care for your special needs child, free of legal complications.

Your other children may then divide your other assets.  These kids are more likely able to address the complications of an inherited IRA or real estate.

Though the life insurance does require you to pay a premium which reduces your estate, your children may find this cost acceptable. The cost is acceptable because the Special Needs child now has funds available immediately following your death.  Further, the other kids can inherit at your death.

Many children prefer this result to the option of waiting for their Special Needs sibling to pass.  Not having to wait diminishes the possibility of resentment towards the Special Needs child.  Further, family assets such as a farm, vacation home or business remain in the family.  Keeping family assets intact is preferable to these assets being sold to cover the Special Needs child’s expenses. Therefore, your other children may even contribute towards the life insurance premium.

Let’s Brainstorm!

I focus my practice on estate planning.  And, I am happy to work with you to review your assets with an eye towards equality.  I am glad to walk you through your options over the phone or in person.  Please feel free to Contact our office for a free consultation.  Let’s talk!

More Planning Questions?

Equalizing siblings inheritances with a special needs child is only a piece of the Estate Planning process. By all means, if you want to learn more, please read my more detailed article, Estate Planning Everything You Need to Know.

In Conclusion: Equalizing Siblings Inheritances With A Special Needs Child

I hope that this article was helpful in explaining equalizing siblings inheritances with a special needs child. Further, I included links to even more detailed information on my website so you can learn more. Therefore, please contact me and let me know how I did. Certainly, your comments and questions are welcome!

Let our Estate Planning lawyers help walk you through what can be a confusing process. To begin with, call to speak to one of our experienced estate planning lawyers.  By all means, our lawyers are ready to answer your questions. In fact, feel free to contact our office for a free consultation. Ultimately our goal is to make the process as painless as possible!

Wills, Trusts, Probate, and Estate Litigation, It’s All We Do!

Tags:

Estate Plan, Estate Planning, Peter Klenk, Special Needs, Special Needs Child, Special Needs Estate Planning, Special Needs Planning Attorney, Special Needs Planning Lawyer, Special Needs Trust, Trusts

What Our clients are saying

Stars

Peter provided outstanding advice and preparation of a will and trusts.

Stars

Peter was excellent. He explained everything very clearly and is super friendly. My wife and I originally tried using a lawyer through group legal coverage, but unfortunately the old adage - "you get what you pay for" - applied to the other lawyer, and we decided to go with a real professional.

Stars

When it came down to picking the right attorney to handle my affairs, I knew right away it was this firm. From speaking to their secretary to speaking to Peter I knew I was making the right decision. After only a few mins Peter knew right away what I was looking for and handled all my questions professionally and even gave me great feedback that put my mind at ease. All that without even giving a single penny! So of course I hired him! So far so good...

Stars

AWESOME LAWYER! Peter Klenk is an exceptional attorney and a very nice person! Today I spoke with Peter about estate planning and was impressed with by his professionalism, cordiality, and attention to detail. I highly recommend Klenk Law for probates, wills, trusts, and other issues germane to estate planning!

Stars

Great friendly staff

Stars

Tremendous firm with bright, kind and tenacious people. Great representation for our family.

Stars

I'm totally satisfied with Klenk Law. Peter has a great legal mind with the personality of the guy next door.

Stars

Everything about my experience was a 10+! Peter and his staff made what I thought would be a difficult process easy and understandable. Every detail was handled correctly. No other firm could possibly do better than Klenk Law!

Stars

Peter and his staff are very responsive and always willing to help my clients and in a cost efficient manner.

Stars

Like another reviewer, I contacted Peter through his website using the free consultation link, for a question regarding PA inheritance taxes. The question was quite technical and difficult to explain, and the answer was nowhere to be found on the web. Peter grasped precisely what I was asking, and provided a clear, helpful response (with a touch of humor) the very next day.

Stars

Answered my question quickly and referred me to a colleague that could handle my problem

Stars

Mr. Klenk, quickly understood the circumstances presented and provided clear and concise advice. This advice provided me with the information I required to progress the case to my advantage.

Stars

Peter is excellent. I had a very complicated situation with my parents' estate planning and potential Medicaid needs. Peter was very knowledgeable in estate planning matters, able to define the best solution for the situation. Additionally, he was congenial and able to communicate effectively to my senior citizen parents the benefits of estate planning. He earned my trust, and more importantly, my parents' trust in a 45 mins consultation period. Highly recommend Peter. He is very easy to work with.

Stars

Peter recently gave a presentation about Wills & Trusts at my employer, and it was fantastic! He was extremely knowledgeable and provided valuable information to the group. People were very engaged and asked several questions, all of which Peter thoroughly answered. Personally, my husband and I have selected Peter to help us with our estate planning, and he has been very helpful in providing us with all of the information we need to provide a secure future for our family. Thank you, Peter!

Stars

Peter provided outstanding advice and preparation of a will and trusts.

Stars

Peter explained things in a way that was easy to understand. Everything was done in the time frame he said it. Could not have been better!

Stars

You & your staff are the best thank you for everything.

Stars

Peter and his staff handled all of our needs in a very professional and timely matter.

Stars

Peter Klenk made a complex subject understandable and allowed us to move forward with our estate planning. He was patient with our questions and creative in the solutions he proposed.

Stars

Peter explained a complex subject very clearly, helped us to decide the best approach to managing our estate and then made it very easy for us to execute the required documents. He will be a valuable resource for years to come and clearly has a great understanding of estate law that will lead to innovative solutions for us. I would unhesitatingly recommend him for estate planning.

Stars

Fantastic customer service. Very personable and most importantly they provide great explanations of what is required based on your individual needs. Highly recommend Klenk Law for anyone that needs to create a will and estate documents.

Stars

Always professional and very responsive. Everyone on the staff that I have worked with. I look forward to continuing our relationship.

Stars

Surprisingly easy

Stars

Affable...yet surprisingly cerebral estate planning atty. High marks all the way around.

Stars

Peter and his associates made things easy for us.

Let us put our expertise to work for you.

Free consultation within 24 hours.