Complications: Divorce and Special Needs Children

Divorce is a challenging process for everyone. If you have a child with special needs, the choices you make during a divorce can have lifelong repercussions, both for you and for the child. It is not always in the best interest of a child with a disability to receive a large award because child support could cancel the child's SSI and Medicaid benefits.

But this is not the only problem child support forms for a child with special needs; a complicated process that the Social Security Administration (SSA) uses to evaluate household income can also wreak havoc with SSI and Medicaid benefits.

When a disabled child lives in a household with other people, the SSA takes into account the income of everyone who lives with the disabled child when it calculates eligibility for benefits. This is known as "income deeming." The SSA applies a formula to define what portion of the household income applies towards eligibility. If the total household income is too high, the disabled child can lose SSI and Medicaid.

In families going through a divorce, income deeming becomes particularly important for two reasons. First, a child with special needs may have siblings who are also receiving child support from an absent parent. In these cases, that additional child support will count as household income and could place the SSI recipient's benefits in jeopardy. Second, the choice of parent who will have custody of the child (the custodial parent) could throw off an SSI benefit if one parent's household income is significantly different from the others. In many cases, loss of SSI benefits is not a key factor in choosing a custodial parent. But in other cases, specifically when the child receives significant benefits from SSI and Medicaid, the choice of a custodial parent could make a tremendous difference for that child's welfare.
Image: africa / FreeDigitalPhotos.net Evan H. Farr on Google +

Parents of Special Needs Kids: Getting Help From Others Without Forfeiting Federal Benefits

Did you know that in the U.S. alone, about 200,000 people under the age of 65 require long term care?  In the D.C. Metro area, about 40,000 children are considered "Special Needs."

Many families are unsure how to plan financially when they first are faced with news that a child with special needs is on the way.  More on that later -- first we'd like to point out a state-of-the art facility called Jill's House that is creating quite a buzz locally:

Jill’s House will offer an exceptional experience for children with special needs.  There will be activities within the music, art, and computer rooms; in the indoor pool; on the outdoor playground; and within the three unique lodging areas all designed especially for children with special needs. - Jill's House

 For parents and caregivers of Special Needs children who require either short and intermittent care or long term care, everyday tasks can be draining.  If day-to-day efforts seemingly go unnoticed, remember the words of poet Heather Cortez, "To the world you may be one person, but to one person you may be the world." 

What qualifies a child as a "Special Needs" child?  The term is used broadly as illustrated by this information guide: "Pick any two families of children with special needs, and they may seem to have little in common." 

Parents of Special Needs children need to plan for their financial future carefully, although when faced with shocking news regarding a child, it is completely normal to be in an emotional state of disarray.  Meet Jason and Amanda:

Jason and Amanda Purnell met while getting their Ph.D.s in psychology at Ohio State, married in 2007, and were ecstatic when Amanda became pregnant shortly before they moved to St. Louis last July to be near family. Then they learned that their 22-week-old fetus had Down syndrome. They were shocked -- at 29, Amanda was well below the at-risk age to conceive a baby with this condition. "The first 24 hours, I was inconsolable.

 "We know we'll be financially supporting Maya for the rest of our lives," Jason tells CNN.

What should a Special Needs family do to prepare?  At least three measures should be strongly considered, some obvious and others not so obvious: Save as much money as possible, plan for 3 retirements, and consider a special needs trust.

For example, the family mentioned above created a trust but it won't be operational until both spouses are dead.  This can be problematic if friends or family members want to contribute to the child's care during her life.  This can be accomplished through a special-needs trust and can even work without risking the loss of federal disability benefits.

For much more information on Special Needs  trusts, click here.

"Anyone can give up, it's the easiest thing in the world to do. But to hold it together when everyone else would understand if you fell apart, that's true strength." 

Image Credit: Dan Evan H. Farr on Google +