A family law attorney who is representing a spouse who is receiving SSI benefits should consider the following issues about preserving eligibility for government benefits.
Spousal Maintenance
A court may grant monthly maintenance to a disabled spouse which may result in that spouse losing valuable public assistance. Texas Family Code section 7.006 offers the parties of a divorce to enter into a settlement agreement. An attorney representing a disabled client should, at least, recommend the creation of a Special Needs Trust (SNT) to preserve their client’s eligibility for benefits.
Child Support
In addition to spousal maintenance, an adult disabled child or a minor child might be receiving child support. Under Texas Family Code section 154.032 authorizes a court to force a parent to continue paying child support after the age of 18. When disabled individuals attain the age of 18, they may be eligible for SSI benefits and health coverage through Medicaid. In addition to health coverage, Texas offers Medicaid waiver programs like Community Living Assistance and Support Services programs to developmentally challenged people prior to age 22. Child support might, inadvertently, cause the child to be ineligible for these benefits.
Issues To Consider Drafting an SNT For a Divorce
- Child support paid to an SNT must be for the sole benefit of the child.
If a child is receiving SSI, an accounting of disbursements must be made during each recertification.
SNT is limited to certain distributions and limitations.
A disabled spouse might not be able to find a trustworthy trustee.
An SNT trust cannot pay for rent but it can buy a house.
Cost-Benefit Analysis of SNT for a Divorce.
An eligible individual can receive up to $841 for SSI benefits. In addition, all health care costs will be covered by Medicaid. An attorney should weigh these benefits with the spousal maintenance or child support payments. The main issue of consideration is the housing option. An SNT cannot pay for rent but it can own a home. Often planning for a paid-off home to be given to a disabled spouse instead of cash is a better option in a divorce.
