There are different reasons to justify paying for a Special Needs Trust. If your child receives or may receive government benefits, such as SSI, read more below.
If you are going to be receiving child support for your child with special needs, you should have your Divorce Decree or SAPCR specify that child support payments should be paid into a 1st Party Special Needs Trust. Another situation where a 1st Party Special Needs Trust is necessary is for settlement or lawsuit funds for the personal injury of your child with special needs.
In the event you or family members wish to leave an inheritance or life insurance benefits to a child with special needs, a 3rd Party Special Needs Trust should be explored for the preservation of eligibility of government benefits.