By: Martinette Jennifer, Esq.
Divorce can be an emotionally charged and frustrating process for anyone. But for divorcing couples with children with special needs, divorce takes on a whole new set of challenges.
Divorcing parents of children with special needs have more complex issues to plan out during a divorce settlement. Both divorcing parents of disabled and non-disabled children will have to negotiate matters such as health insurance, life insurance, and child support payments. However, parents of children with special needs will have to go a step further and negotiate matters such as estate planning, supplemental security income (SSI), social security disability, and special needs trusts, all of which become even more problematic when a child with special needs turns 18 years old.
Let’s look at three critical considerations divorcing parents of special needs children must take to ensure they effectively plan for their child’s future.
1. Child Support’s Impact on Public Benefits
Court-ordered child support payments continue until age 18 in Maryland and age 21 in DC. However, these payments may continue beyond 18 in Maryland and 21 in DC if the child qualifies as an incapacitated individual. Divorcing parents must minimize the negative impact of child support payments on the child’s public benefits eligibility and health insurance coverage. There are resources available, such as SSI, if a child under 18 meets the criteria for being classified as having a disability and there is limited income in the household. However, if the child received child support payments, two-thirds of the child support payments qualify as income and will reduce the amount of the SSI benefit, dollar for dollar.
The age of adulthood under the SSI program is 18. Thus, when a child with a disability becomes an adult at 18, the Social Security Administration must evaluate under the Social Security Disability Insurance (SSDI) program requirements. As an adult child with a disability, the total amount of the child support payments is considered as income, thereby resulting in a reduction in SSI benefits, which can lead to ineligibility for Medicaid. Therefore, some custodial parents will have to decide whether it is more financially advantageous to continue receiving child support payments and forgo public benefits or withhold child support payments and instead enroll their child in public health benefits programs. If the couple decides the latter, they can make an informal child support arrangement to cover expenses ineligible for public benefit coverage.
2. State and Federal Budget Cuts
Another area of concern for parents of disabled children is state and federal budgets. While these budgets allow for programs and resources such as SSI and Medicaid, there is no guarantee that these programs will remain in place year to year. Furthermore, even if budget cuts do not eliminate a program, causing the child to lose health insurance benefits and SSI disability income, the parents still have to be concerned with budget changes that could increase or decrease access to public benefits. And while an increase in public benefits may sound like a good thing, remember there is a correlation between public benefits eligibility and child support payments. Therefore, parents should be concerned with ensuring that one does not disqualify the child from receiving the other or decreasing the amount the child may receive under child support or public benefits.
3. Special Needs Trusts
A unique consideration for divorcing parents with disabled children is establishing a first-party special needs trust to hold child support payments. Because child support payments can reduce or eliminate public benefits eligibility, parents can protect their child’s public benefits and maximize the child support received by having the non-custodial parent make child support payments into a special needs trust for the child’s sole benefit. A trustee administers the trust, and the trustee may utilize the funds for expenses such as clothing, caregiver costs, and medical equipment to improve the beneficiary’s quality of life.
One final note is that divorcing parents of children with special needs must consider the child’s unique needs when deciding on a custody and parenting plan. The divorcing parents may require a special needs planner to assist with developing the child’s schedule and long-term financial needs. With the assistance of knowledgeable family law attorneys and special needs planners, divorcing parents can ensure that their children with special needs are protected and provided for now and in the future.
If you are a parent of a child with special needs and are going through a divorce or maybe considering a divorce, contact our knowledgeable family law attorneys at Andalman & Flynn, who can help you navigate this complex process and get you on the road to making the best possible decisions for your and your child’s future.
About Andalman & Flynn, P.C.: Founded in 1998 in downtown Silver Spring, Maryland, Andalman & Flynn has forged a distinguished reputation for legal excellence. The Firm practices family law, estate planning, and probate throughout Maryland and the District of Columbia, and represents individuals seeking disability benefits throughout the country. The Firm focuses on cases that impact the rights of everyone and is there for clients when responsive legal help is most critical. The Firm has provided legal analysis on national and local television and radio, and its attorneys often testify before legislative bodies and are routinely invited to contribute to prominent legal publications. For more information about Andalman & Flynn, please visit the website at andalmanflynn.com or call 301.563.6685.