While will and estate planning advice is relevant to all families, there are additional considerations when you have a relative with a disability or special needs.

Parents must be concerned about financial security and personal safety, not just for their lifetimes, but for the lifetime of their son or daughter with a disability.

Check your special needs planning quotient with this quiz.

1. (True or False?) Government funds all the programs and services my son/daughter with a disability requires. Therefore, I do not need to leave anything in my estate for them.

   False: Provincial laws require that you provide adequately for your spouse and each of your children in your will. If they have not been provided for adequately they, or the Public Guardian and Trustee on behalf of your family member with a disability, can go to court to change your will. Leaving their share with another family member or expecting that government will provide care for them, will likely be seen as not providing for them adequately.

2. (True or False?) If I set up a discretionary trust I will disqualify my adult relative with a disability from receiving government benefits.

   False: In fact, creating a discretionary trust in your son/daughter's name is the best way to ensure they do receive government benefits. A discretionary trust is not counted as an asset of the person even though it is in their name, because they do not control how the money is spent. In some provinces there are limits on the size of the trust and/or the amount and type of payment a trust can make.

3. (True or False?) The federal disability tax credit is only available when my child with a disability turns 19.

   False: You can apply for the federal disability tax credit as soon as you realize your child has a disability. The tax credit is available to the parents as a tax credit if you continue to support your son/daughter regardless of their age and even if they do not live with you. If you have not applied for the tax credit but are eligible, you can receive credit for the years you did not claim it.

4. (True or False?) I can use life insurance to finance a trust for my son/daughter with a disability.

   True: A life insurance policy on your life can be designated to a discretionary trust on behalf of your son/daughter with a disability. Life insurance proceeds pass outside the will plus they are not subject to probate fees. Grandparents or families with younger children with limited disposable income find this an economical means to finance a trust for their relative.

5. (True or False?) When my child with a mental handicap becomes an adult I still remain their legal guardian.

   False: Once your son/daughter reaches the age of majority, that is, of legal age, you are no longer their legal guardian. You need specific legal authority to make decisions for a child who is now an adult. Thanks to new legislation in many provinces and territories adults with disabilities may participate in their own financial, health care and personal decisions, if necessary with the assistance of other adults, including their parents. Thus, the parent's role in decision making may continue, but in an alternate manner than as legal guardian.

6. (True or False?) I can transfer money in my RRSP or RRIF into a trust for my son/daughter with a disability without paying any tax.

   Maybe!: The good news is that federal legislation permits the transfer of RRSP's and RRIF's to a dependent adult with a disability without paying the tax in some circumstances. However, these circumstances are quite restrictive. The bad news is that even in the unlikely event your son/daughter receives the funds, they might be treated as an asset, thereby disqualifying them from government benefits. PLAN is engaged in active discussions with both federal and provincial governments to improve this situation.

7. (True or False?) I cannot name one of my other children as trustee of funds I leave for my son/daughter with a disability.

   False: You may name one or more of your other children as trustee of the discretionary trust you establish for your child with a disability. However, there may be the perception of conflict of interest, since they or their survivors may stand to inherit the remainder of the estate. In some provinces this perception of conflict of interest may invite scrutiny from the Public Guardian and Trustee.

8. (True or False?) Once my son/daughter with a disability dies, any money left in the trust goes to government.

   False: The funds left in any trust you set up will not go to government. When you establish a discretionary trust for your son/daughter with a disability your lawyer will ask you to identify beneficiaries of the reminder of the trust. Since most families establish a discretionary trust exclusively for the benefit of their relative, PLAN recommends inserting a clause in your will advising your trustees to spend all or most of the capital and interest for the benefit of the person with a disability during their lifetime.

9. (True or False?) A trust can own a home on behalf of my son/daughter with a disability.

   True: The next best thing to having a place of your own is to have a trust which owns your place. This is an approach more and more Canadian families are taking to guarantee long-term housing. To prevent exploitation, they purchase a home for their son/daughter and place it in a trust. Or they permit the trust they establish to pay out part of the capital in the trust to buy the beneficiary a home. Since the trust is in their son/daughter's name, they will enjoy all the other benefits of being a homeowner. For example, in some provinces they may receive a homeowner's grant.

   A home lived in by the individual, whether owned directly or in a trust, does not disqualify the individual from government benefits.

10. (True or False?) Only a trust company can act as trustee.

    False: Anyone can be a trustee. For smaller trusts a family member or friend can be an excellent trustee. For trusts with larger sums of money, you may want to consider using a trust company. PLAN recommends a co-trustee arrangement. One trustee can be someone who has a caring, personal relationship with your relative with a disability and the other trustee can be a neutral third party (such as a trusted friend or trust company) who does not stand to benefit from your estate.

11. (True or False?) If I die without a will my son/daughter with a disability will be taken care of by people I trust.

    False: If you die without a will your estate will be divided according to a formula established by each provincial government. Decisions will be made by people who do not know your relative, and there is no guarantee the money will go where you want it to. Since the money will not be in a discretionary trust, your son/daughter with a disability may become ineligible for government support. Further, if there is no surviving parent who has legal custody of your minor children, a government agency may become their guardian. To prevent a costly, complicated and potentially heart-breaking outcome, you must make a will.

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