Families of individuals with developmental disabilities face unique challenges when planning. Beyond daily care and medical support, they must ensure that their loved ones have financial stability, legal protections and access to essential services even after caregivers can no longer provide direct support.

As March is Developmental Disabilities Awareness Month, it’s an opportune time to recognize the importance of long-term estate planning for people with disabilities. With the right legal and financial tools, families create a secure future where their loved ones live with dignity and independence.

The Importance of Special Needs Planning

Many families assume that personal savings or inheritance will be enough to support a child or family member with developmental disabilities. However, without proper planning, those funds may disqualify individuals from critical government benefits, such as Medicaid and Supplemental Security Income (SSI).

Special needs planning ensures that financial resources enhance a person’s quality of life without jeopardizing access to essential benefits. A well-structured plan includes legal protections, funding strategies and long-term care considerations.

Special Needs Trusts and Other Key Legal Tools

A special needs trust (SNT) is one of the most effective ways to provide financial support, while maintaining eligibility for government programs. Trusts allow families to set aside money for expenses not covered by Medicaid or SSI, such as housing, education, and recreational activities.

There are three main types of special needs trusts:

• First-party SNT: Funded with assets belonging to the individual with disabilities, often used for lawsuit settlements or inheritances
• Third-party SNT: Created by parents or relatives, funded with private assets for the beneficiary’s lifetime care
• Pooled SNT: Managed by a nonprofit, allowing families with fewer assets to benefit from professional trust administration

Without a properly structured trust, assets left to a disabled individual could unintentionally disqualify them from vital support programs.

Guardianship and Decision-Making Support

Many individuals with developmental disabilities need assistance managing finances, healthcare and daily responsibilities. Depending on their level of independence, families may consider:

• Guardianship: A court-appointed legal arrangement giving a caregiver authority over personal and financial decisions
• Power of Attorney (POA): A document allowing a designated person to manage financial or medical decisions on behalf of the individual
• Supported Decision-Making Agreements: A legal framework that allows individuals to retain autonomy, while receiving guidance from trusted supporters

Each option provides varying levels of control, allowing families to choose the least restrictive alternative that meets their loved one’s needs.

ABLE Accounts

Achieving a Better Life Experience (ABLE) accounts are tax-advantaged savings accounts for individuals with disabilities. They allow beneficiaries to save money for qualified expenses without affecting SSI or Medicaid eligibility.

ABLE accounts can be used for education, housing, healthcare and assistive technology. Unlike traditional savings accounts, these funds are not counted toward asset limits for public benefits.

Individuals with a disability that occurred before age 26 who meet certain criteria are eligible to open a Maryland ABLE account.

Life Insurance and Estate Planning

Many parents worry about what will happen to their children when they can no longer provide care. Life insurance policies can ensure ongoing financial support, with funds directed into a special needs trust. Families should also update their estate planning documents to reflect their child’s needs and appoint trusted individuals to oversee their care.

The Role of an Attorney in Special Needs Planning

Creating a financial and legal plan for a loved one with disabilities requires careful attention to detail. Without proper structuring, even well-intended gifts or inheritances could create financial hardship.

An elder law and special needs planning attorney ensures that:

• Trusts and financial accounts are properly structured to maintain government benefit eligibility
• Legal documents, such as guardianship agreements and powers of attorney, are tailored to the individual’s needs
• Families are aware of state and federal programs that can provide additional resources

Working with an attorney provides peace of mind, ensuring that a loved one’s future is secure, and their quality of life is protected.

Secure a Better Future for Your Loved One

Planning for a family member with developmental disabilities is an act of love and responsibility. The proper legal and financial steps ensure that they have lifelong support and access to the care they need. Our special needs planning law firm helps families create comprehensive special needs plans that protect assets, maximize benefits and ensure peace of mind. Schedule a consultation today with one of our experienced estate planning attorneys to start planning for a secure future.

Key Takeaways

• Special needs trusts protect assets: These trusts allow families to provide financial support without jeopardizing eligibility for Medicaid or SSI.
• Guardianship and decision-making tools offer support: Legal arrangements, such as POAs, guardianship, and supported decision-making agreements, ensure that a loved one’s needs are met.
• ABLE accounts provide tax advantages: These accounts allow individuals with disabilities to save money without affecting government benefits.
• Estate planning ensures long-term security: Life insurance, updated wills and carefully structured inheritance prevent financial disruptions.
• Legal guidance prevents costly mistakes: An attorney helps families navigate complex rules and secure the best possible future for their loved ones.

References: National Association of Councils on Developmental Disabilities “Developmental Disabilities Awareness Month” and Special Needs Alliance “Long-Term Care Planning for Children with Disabilities”

Building wealth is only half the battle—ensuring that it lasts for future generations requires careful estate planning and strategic wealth management. Many families fail to implement a structured plan, leading to lost assets, unnecessary taxes and family disputes. Without the proper legal and financial strategies, even substantial inheritances can be squandered within a generation.

An estate planning attorney plays a crucial role in bridging the gap between generations, ensuring that wealth is protected, distributed according to the family’s wishes, and sustained for years to come.

Why Generational Wealth Often Fails to Last

Studies show that 70% of wealthy families lose their wealth by the second generation and 90% by the third. The primary causes include:

• Lack of financial literacy – Heirs often receive wealth without a plan for responsible management.
• Estate tax burdens – Without proper planning, substantial portions of an estate may be lost to federal and state taxes.
• Legal disputes – Poorly structured wills and trusts often lead to costly inheritance battles.
• Failure to adapt to changing financial laws – Inheritance laws, tax regulations and trust structures evolve over time.

Estate planning provides legal structures and safeguards to prevent these issues and ensure that family wealth remains intact.

How Estate Planning Protects Generational Wealth

Structuring Trusts for Long-Term Asset Protection

Trusts are among the most effective tools for protecting wealth and ensuring that assets are passed down responsibly. Unlike a will, which simply distributes assets, trusts provide ongoing management and protection.

A solid estate plan may include the use of the following Trust structures:

• Revocable Living Trusts – Allow individuals to control assets during their lifetime, while avoiding probate upon death.
• Irrevocable Trusts – Provide stronger asset protection and tax advantages by permanently removing assets from the grantor’s estate.
• Generation-Skipping Trusts (GSTs) – Allow assets to bypass one generation, reducing estate tax liability for grandchildren.

Trusts also allow customized inheritance distribution, such as delayed payouts, financial milestones, or incentives for responsible wealth management.

Minimizing Estate Taxes and Legal Fees

High-net-worth individuals face significant estate tax challenges if wealth is not structured correctly. An estate planning attorney helps reduce tax exposure through:

• Gifting strategies – Annual tax-free gifts to heirs reduce taxable estate size.
• Charitable giving – Donating assets through charitable remainder trusts or donor-advised funds offers tax deductions while benefiting causes.
• Family Limited Partnerships (FLPs) – These allow wealth to be transferred gradually, minimizing tax burdens.

Without tax planning, heirs may be forced to sell assets or businesses to cover tax liabilities.

Preventing Family Disputes Over Inheritance

Even well-meaning families can experience conflict over wealth distribution. An estate planning attorney helps prevent disputes by:

• Creating straightforward wills and trust agreements that specify asset distribution.
• Including business succession plans to ensure seamless leadership transitions in family businesses.
• Establishing conflict resolution mechanisms like mediation clauses to settle disputes outside of court.

A structured estate plan ensures that inheritance disagreements do not escalate into costly legal battles.

Teaching Financial Responsibility to Heirs

Wealth transfer is more effective when heirs understand how to manage their inheritance. Estate planning attorneys work with families to:

• Educate younger generations on financial management and investment strategies.
• Introduce heirs to financial advisors who can help them navigate wealth preservation.
• Incorporate inheritance incentives that promote responsible spending and investment.

Without financial education, even a well-structured estate plan can fail to maintain generational wealth. As a client of Sims & Campbell, we can connect you with our referral partners, such as a CPA or Financial Advisor, to strengthen your team of advisors that will guide your family upon your incapacity or death.

Estate Planning for Business Owners

Companies often struggle to survive past the first generation without a business succession plan. Family businesses require careful succession planning to ensure stability after the founder’s passing. An estate planning attorney helps:

• Identify and prepare successors for leadership transitions.
• Establish buy-sell agreements to ensure smooth ownership transfers.
• Structure ownership in trusts or LLCs to provide financial protection.

Secure Your Family’s Financial Legacy

Estate planning is more than wealth transfer—it’s about ensuring that assets are preserved, managed wisely and passed down without unnecessary financial losses. Our law firm helps families create customized estate plans that protect wealth for generations. Schedule a consultation today to safeguard your legacy.

Key Takeaways

• Generational wealth often fails without planning: Families that do not structure inheritance properly risk losing assets within a generation.
• Trusts protect wealth and control distributions: Properly structured trusts ensure responsible asset management and prevent mismanagement by heirs.
• Tax planning preserves more wealth: Estate taxes can erode inheritances. However, gifting strategies and charitable giving help reduce tax liabilities.
• Clear estate plans prevent family conflicts: Legally binding wills, trusts and mediation clauses prevent disputes over wealth distribution.
• Financial education ensures wealth lasts: Teaching heirs responsible financial management strengthens long-term asset preservation.

References: J.P. Morgan (Nov. 18, 2024) “We Need to Talk: Communicating Your Estate Plan With Your Family” and Business Insider (Feb. 9, 2025) “Inside the Retreat for Billionaire Heirs Trying to Give Away Their Money”

We previously shared updates regarding the Corporate Transparency Act (“CTA”), most recently reporting that the injunction against enforcement of the CTA was overturned and deadlines for most filers were extended to January 13, 2024.

We have yet another change to report. Late December 26, 2024, a panel for the Fifth Circuit Court of Appeals reinstated the injunction until it can hear oral arguments from the parties and issue a ruling on the government’s appeal of the original injunction.

We anticipate a ruling and more updates in early January.  In the meantime, we continue recommend all parties required to file under the CTA should be prepared to file on short notice after the court’s ruling provides more clarity.

We will continue to monitor the situation and share updates as they become available.

Sims & Campbell, LLC- Annapolis and Towson Estate Planning Attorneys

This afternoon (December 23, 2024), the United States Court of Appeals for the Fifth Circuit reinstated the enforceability of the Corporate Transparency Act (CTA) effective immediately. In Texas Top Cop Shop, Inc. v. Garland, a three-judge panel of the Fifth Circuit stayed a lower court’s nationwide preliminary injunction against the CTA, which was issued on December 3, 2024. This means that, among other obligations, the January 1, 2025, compliance deadline for reporting companies in existence as of January 1, 2024, is back in effect.

This situation is likely to rapidly evolve. It is entirely likely that in the coming days, the challengers in this case will seek further review from the Fifth Circuit or seek relief from the United States Supreme Court. Additionally, several other federal courts are actively considering challenges against the CTA. At the time of this writing the United States Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) has not publicly released any guidance based on today’s ruling.

We will continue to monitor this development closely and provide updates as they become available. For clients concerned about the implications of this ruling on their business or estate planning, please feel free to contact us.

Sims & Campbell, LLC- Annapolis and Towson Estate Planning Attorneys

A recent ruling by the U.S. District Court for the Eastern District of Texas has preliminarily blocked the nationwide enforcement of the Corporate Transparency Act (CTA). This decision impacts businesses nationwide, as the CTA aimed to require U.S. business entities to report stakeholder information to the Treasury Department to combat money laundering and other illicit activities through shell companies. The injunction was issued in response to a lawsuit by Texas Top Cop Shop Inc. and co-plaintiffs, arguing that the CTA oversteps Congress’s constitutional authority to regulate commerce, especially since it applies to entities regardless of their engagement in commercial activities. This ruling halts the implementation of these reporting requirements temporarily, pending further legal proceedings, which could have significant implications for estate planning and business privacy. As a result, individuals are no longer required to file but that may change in the future based on court decisions and agency regulations.

We will continue to monitor this development closely and provide updates as they become available. For clients concerned about the implications of this ruling on their business or estate planning, please feel free to contact us.

[For further reading on the CTA and its implications, see the article here: https://news.bloombergtax.com/daily-tax-report/corporate-transparency-act-blocked-nationwide-by-texas-court ]

Sims & Campbell, LLC- Annapolis and Towson Estate Planning Attorneys

Effective January 1, 2024, the Corporate Transparency Act (the “CTA”) will implement beneficial ownership information reporting requirements for corporations, limited liability companies and other business entities that were created in or are registered to do business in the United States. The CTA requires that certain information about the business’ owners be provided to the Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) and imposes significant penalties for noncompliance.

The purpose of the CTA, which is part of a broader effort by FinCEN to try to crackdown on illegal activity such as money laundering, corruption, tax fraud and terrorist financing, is to provide greater transparency of owner information to try to prevent criminals from hiding illegal property in the United States.

Who is required to file?

Corporations, limited liability companies and other business entities that were created by a filing with a secretary of state or a similar office to create the entity or, for foreign companies, a registration to do business in the United States.

The CTA contains 23 exemptions, mostly for large companies, such as publicly traded corporations, and businesses that the federal government heavily regulates, as these companies are already providing the information to the government.

Limited liability companies created for estate planning purposes must comply with the CTA.

What to file?

A business that is required to report beneficial ownership information under the CTA (called a “reporting company”) will be required to provide:

• legal name and any trade name or dba;
• address;
• jurisdiction in which it was formed or first registered, depending on whether it’s a U.S. or foreign company; and
• taxpayer identification number.

For each reporting company’s beneficial owners and each reporting company applicant, the following information with respect to individual owners will also be required:

• legal name;
• birthdate;
• address (in most cases, a home address); and
• an identifying number from a driver’s license, passport or other approved document for each individual, as well as an image of the document that the number is from.

There can be up to two individuals who qualify as a reporting company’s applicants:

• the individual who directly files the document that creates, or first registers, the reporting company; and
• the individual that is primarily responsible for directing or controlling the filing of the relevant document.
• A reporting company is only required to report company applicants if it is created or registered on or after January 1, 2024.

When to file?

• A reporting company created or registered before January 1, 2024 is required to file before January 1, 2025.
• A reporting company created or registered on or after January 1, 2024 is required to file within 30 calendar days of receiving actual or public notice that the company has been created, or upon receipt from your state’s secretary of state or similar office that the company was created or registered, whichever is earlier. FinCEN has reported that it will accept reports electronically beginning January 1, 2024. There is a proposal to extend the time to file for the first year to 90 days, but the extension has not been granted yet.

Please contact us with any questions.

Sims & Campbell, LLC- Annapolis and Towson Estate Planning Attorneys