Should I name my special needs child as a beneficiary of my IRA?
Do not name your special needs child directly as a beneficiary of a retirement plan if your child receives or may later need SSI, Medicaid, or other benefits such as Section 8 assistance or food stamps. The distributions from the retirement account will either reduce the entitlements or eliminate them entirely. Instead, if you want your child to receive your retirement benefits, the named beneficiary on the account can be the special needs trust for your child.
Even so, this trust should contain special provisions not typically found in special needs trusts to insure the most favorable stretch-out and tax treatmentTags: estate planning, special needs, Special Needs Trusts