There is a trap in ordinary estate planning that catches families with a disabled child or sibling, and it catches them in the most painful way possible: by working exactly as written.
You leave your daughter an equal share. She receives it. And because she received it, she loses the benefits she was relying on.
Why an inheritance can do damage
SSI and Medicaid are means-tested. Eligibility depends on the beneficiary’s own countable assets staying under a very low ceiling, and an inheritance arriving in their name counts.
The benefits stop. The inheritance gets spent down, frequently at private rates on the care the benefits were covering. Then the family reapplies and rebuilds eligibility from scratch.
And it is not only cash at stake. Medicaid is often the mechanism behind a group home placement, a day program, supported employment, or a waiver slot that took years to obtain. Some of those are not simply re-obtainable once lost.
Disinheriting is the wrong fix
Leaving the disabled child nothing and asking a sibling to look after them informally is understandable and it is a bad idea.
Money left to a sibling is legally the sibling’s. It is exposed to their divorce, their creditors, their own death and their own estate plan. If the relationship changes, there is no enforceable obligation to anyone. You have not protected the benefits; you have removed the safeguards.
What we prepare
Third-party special needs trusts, funded with a parent’s or grandparent’s money through their estate plan. This is the ordinary case and the flexible one. Whatever remains at the beneficiary’s death passes to whomever you named.
First-party trusts, funded with the beneficiary’s own money, typically a settlement or an inheritance that already arrived in their name. These carry a Medicaid payback requirement and stricter rules, which is exactly why planning ahead beats fixing it afterwards.
We also advise on MiABLE accounts, which let a person disabled before age 26 hold savings in their own name up to a limit. They work alongside a trust rather than instead of one.
The trustee decision
Drafting is the straightforward part. Choosing who administers the trust for potentially forty years is not.
The trustee has to understand how distributions interact with benefits, because a well-meant payment made the wrong way can reduce an SSI check. The person best suited to raise your other children is not automatically the right person for this, and separating the roles is common and sensible.