It takes hard work, patience, and sacrifice to care for a child with special needs. You have likely spent years coordinating therapies, school services, medical appointments, benefits, and daily support. It only makes sense that you want a plan protecting your child now, and long after you can no longer provide care yourself.
Special needs planning is not only about money. It is about care, housing, decision-making, government benefits, family responsibilities, and your child’s quality of life.
This Maryland-focused guide explains the essential steps for planning for a minor or adult child with a disability.
1. Start With Your Child’s Actual Level of Care Needs
Every effective plan starts with function, not merely diagnosis.
You should document your child’s actual needs, including:
- Medical conditions, medications, and health care needs
- Physical, occupational, speech, behavioral, and other therapies
- Assistance with bathing, dressing, toileting, eating, mobility, and other activities of daily living
- Supervision and safety concerns
- Communication abilities and preferred methods of communication
- Behavioral supports and crisis plans
- Educational, vocational, and employment services
- Transportation needs
- The ability to manage money, medications, appointments, and personal relationships
Needs often change as your child moves from childhood to adolescence, adulthood, and later life. A child who requires constant supervision today may eventually need supported employment, an apartment with assistance, or a residential setting.
A written functional and medical assessment helps your family, attorneys, care coordinators, and future caregivers understand what support is truly necessary. Eligibility for SSI, Medicaid, and Maryland Developmental Disabilities Administration services often depends on functional and medical criteria, not diagnosis alone.
Start documenting now. Keep a current list of providers, medications, therapies, routines, strengths, preferences, and challenges.
2. Plan Living Arrangements Now, and for the Future
Many children with special needs live at home with their parents. That arrangement can work well, but it should not be the only plan.
Consider the full range of possibilities:
- Living at home with parents
- Living with a sibling or other family member
- In-home support from paid caregivers
- Host homes or shared-living arrangements
- Group homes or alternative living units
- Supported apartments
- Independent living with regular supports
- Intermediate care facilities
- Residential treatment or specialized facilities for higher-acuity needs
Ask the difficult question directly: What happens when we are gone?
Would a sibling be willing and capable of providing support? Would your child live in a paid residential setting? Would funded in-home care be sufficient? Who would monitor services, attend appointments, and advocate for your child?
Create a letter of intent. It is generally not a legal document, but it can be one of the most valuable resources you leave behind. Include your child’s:
- Daily routine and personal preferences
- Medical history and providers
- Medications and allergies
- Communication style
- Likes, dislikes, fears, and calming techniques
- Religious, cultural, and dietary preferences
- Friends, activities, and employment goals
- Important documents and benefit information
3. Does Your Adult Child Need Guardianship?
A parent’s authority does not automatically continue when a child turns 18. At adulthood, your child becomes legally responsible for personal, medical, and financial decisions.
Guardianship is not automatic, and it is not always necessary.
Maryland families should consider alternatives in order from least restrictive to more restrictive:
- Supported decision-making, where your adult child retains decision-making authority but receives help understanding choices and communicating decisions.
- A financial power of attorney, if your adult child has the capacity to authorize an agent to handle financial matters.
- A health care power of attorney and advance directive, allowing an agent to make health care decisions when your adult child cannot.
- Representative payee arrangements for Social Security benefits, when appropriate.
- Guardianship of the person, property, or both.
Remember that estate planning generally requires two separate powers of attorney:
- One for financial and legal matters
- One for health care decisions
A Maryland court considers guardianship only when clear and convincing evidence shows that the adult cannot make or communicate responsible decisions and no less restrictive alternative will adequately protect the person.
The court may require evaluations from two physicians or from one physician and one psychologist or other qualified professional. The court also appoints counsel for the alleged disabled person, reviews the evidence, and maintains ongoing oversight.
A guardian of the person handles decisions involving health care, housing, safety, and personal needs. A guardian of the property manages money and assets. Guardians generally must file reports, inventories, and financial accounts.
Guardianship should be tailored and revisited. If supported decision-making or powers of attorney become adequate, the family can explore modifying or ending the guardianship.
Learn more through the Maryland Courts’ guardianship resources.
4. Use a Special Needs Trust to Protect Benefits
For 2026, SSI resource limits are generally $2,000 for an individual and $3,000 for a couple. The federal SSI benefit rate for an individual is $994 per month. An inheritance or settlement received outright can quickly disqualify your child from SSI and Medicaid.
There are two primary types of special needs trusts.
First-party special needs trust
A first-party, or “self-settled,” special needs trust holds your child’s own assets, such as:
- A personal injury settlement
- An inheritance received directly
- Back benefits
- Savings or other property already owned by your child
These trusts generally require Medicaid payback provisions when the beneficiary dies.
Third-party special needs trust
A third-party special needs trust is funded with assets belonging to parents, grandparents, siblings, or other people. It can be created during life or through a will or living trust.
A properly drafted third-party trust usually does not require Medicaid payback, allowing remaining assets to pass to other beneficiaries after your child’s death.
This is why you should never leave money directly to a child receiving or applying for means-tested benefits. The inheritance should pass into the special needs trust, not to your child individually.
A properly administered trust can pay for supplemental needs such as education, transportation, recreation, technology, therapies, personal items, advocacy, and quality-of-life expenses. The trustee generally has discretion to make distributions, rather than giving the beneficiary unrestricted access.
The trust should identify a capable trustee and successor trustee. Because improper drafting or distributions can jeopardize SSI or Medicaid, use an attorney familiar with Maryland law and federal benefit rules. See Amenta Law Firm’s guide to special needs planning.
5. Consider a Maryland ABLE Account
An ABLE account is a flexible companion to a special needs trust. Eligible individuals whose disability began before age 46 can use an ABLE account for qualified disability expenses, including:
- Housing
- Transportation
- Education
- Health care
- Assistive technology
- Employment supports
- Everyday disability-related expenses
For 2026, the standard annual contribution limit is $20,000. An employed beneficiary may qualify for an additional ABLE to Work contribution, subject to earned-income and retirement-plan rules.
Maryland also allows a state income tax subtraction of up to $2,500 per contributor per beneficiary, or up to $5,000 for joint filers, subject to current Maryland requirements.
An ABLE account is simpler and less expensive to establish than a trust and is useful for routine spending. However, account balances and SSI rules must be monitored. SSI cash benefits can be suspended when an ABLE account exceeds $100,000, even though Medicaid eligibility may continue.
A special needs trust has no comparable contribution cap, can hold larger assets and real estate, and is better for long-term planning. Many families use both: the trust holds major assets, while the ABLE account handles everyday expenses.
6. Coordinate Every Estate Planning Document and Beneficiary Designation
The most common mistake is leaving assets outright to a child with special needs.
That mistake can occur through:
- A will
- Life insurance
- Retirement accounts and IRAs
- Annuities
- Bank or brokerage payable-on-death designations
- Transfer-on-death accounts
- Jointly titled property
- A newly opened account that was never reviewed
Beneficiary designations generally override a will. Review every account and direct your child’s share to the third-party special needs trust.
Your plan should coordinate:
- Wills and revocable living trusts
- Life insurance, often a practical way to fund the trust
- Retirement accounts, using careful “see-through” or accumulation trust drafting
- Annuities and investment accounts
- Real estate ownership
- POD and TOD designations
- Trustee and successor trustee appointments
You can equalize inheritances among siblings without disinheriting the child with special needs. Discuss who will serve as trustee, who will advocate for your child, and how siblings can participate without relying on informal promises.
7. Put the Broader Care Plan in Place
Meet with your DDA service coordinator early. Maryland’s Family Supports and Community Supports waivers were consolidated into the Community Pathways Waiver effective October 6, 2025. The waiver is not an entitlement, so joining the registry and addressing eligibility early is important.
Families should also ask about the FY2027 60/40 rule, which limits paid hours provided by relatives and legally responsible persons. Confirm the current service-specific application with your DDA coordinator or Coordinating Center.
Your own incapacity planning matters, too. Each parent should have:
- A financial power of attorney
- A health care power of attorney
- An advance directive
- An updated estate plan
Your incapacity or death should not create an immediate crisis for your child.
Common Mistakes to Avoid
- Leaving assets outright to your child
- Disinheriting your child entirely
- Relying on verbal sibling promises
- Waiting until a parent becomes ill
- Using a generic trust
- Naming your child directly on insurance or retirement accounts
- Failing to fund the trust
- Failing to update documents after moving or opening accounts
- Ignoring changes in benefits, laws, or your child’s needs
Action Checklist
- Document your child’s functional, medical, behavioral, and daily care needs.
- Identify current and future living arrangements.
- Prepare a detailed letter of intent.
- Evaluate supported decision-making, powers of attorney, and guardianship.
- Establish the appropriate special needs trust.
- Consider a Maryland ABLE account for qualified expenses.
- Review every beneficiary designation and account title.
- Choose a trustee, successor trustee, and future advocate.
- Contact DDA and address waiver waitlists early.
- Review the plan every year or after a major life change.
Frequently Asked Questions
Is guardianship always necessary?
No. Supported decision-making, a financial power of attorney, a health care power of attorney, an advance directive, or a representative payee may provide sufficient support. Guardianship is appropriate only when less restrictive alternatives do not meet your adult child’s needs.
How much does a special needs trust cost?
The cost depends on the trust type, complexity, assets involved, and attorney’s fees. A properly drafted trust is usually far less expensive than losing SSI, Medicaid, or essential care because of an avoidable planning mistake.
Can grandparents contribute to a special needs trust or ABLE account?
Yes. Grandparents can contribute to a third-party special needs trust or an ABLE account. They should coordinate contributions with the trustee and review beneficiary designations before making gifts.
What happens if we do nothing?
Your child may receive assets outright, lose means-tested benefits, face housing and care uncertainty, or require an emergency guardianship proceeding. START YOUR SPECIAL NEEDS PLAN NOW.
Can a sibling be the trustee?
Yes. A sibling can serve as trustee if the sibling is responsible, available, financially organized, and willing to follow benefit rules. Naming a professional or corporate co-trustee may provide additional continuity.
Does a special needs trust affect SSI or Medicaid?
A properly drafted and administered trust generally protects eligibility because the beneficiary does not have unrestricted access to the trust assets. Distributions and trustee administration must still comply with SSI and Medicaid rules.
What happens to money left in the trust when the beneficiary dies?
Remaining assets in a third-party trust generally pass to the people or organizations named in the trust. A first-party trust generally requires Medicaid payback before any remaining funds pass to others.
If you are planning for a minor or adult child with special needs in Baltimore, Harford, Cecil, Carroll, or Anne Arundel County, call Amenta Law Firm to discuss a coordinated plan. Rules, limits, and program requirements change, and this article is general information, not individualized legal advice.