What Is a Special Needs Child? Definition and Financial Resources

Updated October 15, 2024

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A special needs child is a youth who has been determined to require specific care, attention, and accommodations that other children do not. The state may declare this status to offer benefits and assistance for the child’s well-being and growth. Special needs can also be a legal designation, particularly in the adoption and foster care community, wherein the child and guardian receive suppo🍸rt to help them lead productive ♛lives.

Key Takeaways

The definition of special needs concerning a child covers various conditions, including physical ailments, learning disabilities, and terminal illnesses.
Parents and guardians of special needs children usually receive tax credits or deductions to help offset the cost of raising a special needs child.
Families covered under a high-deductible health plan (HDHP) may also be able to maximize tax deductions with a health savings account (HSA).
Some special needs children can attend public schools that offer educational and emotional support programs, such as occupational therapy and one-on-one teacher aides.

Who Qualifies as a Special Needs Child?

Special needs classification can encompass various conditions and impairments, including c𓄧hronic and terminal illnesses, physical impairments, and cognitive or psychiatric issues.

The assistance and medica♛l attention that elevating the quality of life for special needs children may require can result in long-term༺ and escalating costs. The extent of the child’s condition may call for far-reaching medical support to allow the child to live and thrive.

For example, a child with a debilita𓂃ting or life-threatening condition that is per♕manent could require constant medical support throughout their lives.

Special needs children may requir⛄e regular monitoring in case their ailme♛nts become exacerbated. The child may need support equipment for mobility around the residence and support animals such as specially trained dogs.

Important

Special needs children may need special attention and care that other 🔥children do not, especially if they have a life-threatening condition or severe physical, cognitive, or learning disabilities.

Tax Implications and Savings

The guardians of special needs children typically receive additional tax credits or deductions to address the costs and efforts of providing for child care and 澳洲幸运5开奖号码历史查询:well-being.

Earned Income Tax Credit

Taxpayers may qualify for the 澳洲幸运5开奖号码历史查询:Earned Income Tax Credit (EITC) if they meet certain income thresholds. This credit is refundable, meaning taxpayers can receive part or all of the credit as a refund. Parents and guardians of permanently disabled adult children can also claim the EITC for their dependents as long as they meet IRS qualifications.

Child and Dependent Care Credit

The 澳洲幸运5开奖号码历史查询:Child and Dependent Care Credit is typically restricted to guardians of children under the age of 13. However, the credit extends to taxpayers with dependents of any age who cannot care for themselves and live with their guardian for at least half the year. Note that this credit is non-refundable, meaning that it can reduce your income to zero but won't add to your refund.

Deductions for Medical Expenses

Guardians of dependents with disabilities might be able to claim deductions for 澳洲幸运5开奖号码历史查询:medical expenses, including copays, treatments, and home modifications. However, medical expenses must exceed 7.5% of your 澳洲幸运5开奖号码历史查询:adjusted gross income (AGI) to be eligible for the deduction. Keep in mind that you won't be able to claim the same expenses for this deduction and the Child and Dependent Care Credit.

Tip

If you have a 澳洲幸运5开奖号码历史查询:high-deductible health plan (HDHP), you can also use a tax-advantaged 澳洲幸运5开奖号码历史查询:health savings account (HSA) to help save for expenses. Individual contributions to an HSA are 100% tax-deductible beyond the threshold (7.5% of gross income).

Special Considerations

A special needs child may require alternative approaches to education that accommodate their conditions and work towa🧔rd creating ways to further their capacity to learn and develop.

For instance, a child with impaired physical mobility or challenges communicating through traditional verbal cues may need training in other ways and how to a🌌pply those skills in the classroom and real-world settings.

When a s♊pecial needs child has cognitive impairments, their education may require expertis🦄e in addressing such issues and finding methods for connecting with them. Some examples of this can include taking substantially more time and effort to ensure they can understand the lesson and advance to another stage of learning.

🧸Though public education is open to all students, not all teachers have enough training to present lessons in ways that address these needs. As a result, special needs children may get taught privately in classes or schools dedicated to addr🌠essing those needs.

What Financial Help Is Available for Parents of Special Needs Children?

Several government programs exist to ease the financial burden of supporting a special needs child. Special needs children are eligible for subsidized health care programs such as Medicaid or 澳洲幸运5开奖号码历史查询:the Children's Health Insurance Program (CHIP).

Some programs offer direct payments or assistance with securing food and shelter, such as Supplemental Security Income (SSI), Temporary Assistance for Needy Families (TANF), and the Supplemental Nutrition Assistance Program (SNAP)🧜. Also, various nonprofits offer grants to help offset costs.

Are Children With Special Needs Eligible for Supplemental Security Income (SSI)?

Children with special needs who are under the age of 18 can qualify for SSI if they meet several parameters based on their income level and the type of disability. Payments may vary from state to state, and conditions get reevaluated every three years. Eligibility for SSI disability payments may begin after the child's 18th birthday, but a different evaluation may occur.

How Can You Build a Financial Plan for Children with Special Needs?

Considering the unpredictability of the future cost of care, parents can open a 澳洲幸运5开奖号码历史查询:special needs trust so that parents and loved ones can contribute financially. A fiduciary would oversee the 𝓰trust and disburse the funds to cover costs, ܫsuch as medical expenses, caretakers, or transportation.

Also, the money held in a special needs trust does not affect or disqualify the child from receiving public assistance programs. With programs such as SSI, grants, and nutritional and 澳洲幸运5开奖号码历史查询:health care, parents can build a sustainable plan for their child's care.

How Do ABLE Accounts Benefit a Special Needs Child?

澳洲幸运5ꦜ开奖号码历史查询:Achieving a Better Life Experience (A🐻BLE) plans, or 529A ABLE accounts, are tax-advantaged savings plans similar to 529 college savings plans. Their beneficiaries are special needs children and adults under the age of 26. Money deposited into an ABLE account can be invested, growing tax-free, with distributions covering qualified disability e🅷xpenses.

Any person can contribute to a beneficiary’s ABLE account—a parent, grandparent, or family friend—up to the gift tax exemption limit of $18,000 annually. For SSI eligibility, the first $100,000 of an ABLE account balance is excluded as a resource and exceeding that amount may lead to a suspension of SSI payments.

Can a Child Have Both an ABLE and a Special Needs Trust?

Yes, a special needs child can have both an ABLE and a special needs trust since each type of account can pay specific qualifying expenses. A special needs trust can offer more leeway for parents to secure their child's future beyond them since there is no upper limit. However, ABLE plans may cover basic living expenses like rent, whereas a special needs trust may not.

Is "Special Needs" Insensitive?

The National Disability Rights Network says “special needs” is considered condescending and offensive and should be avoided, along with “differently abled” and “physically challenged.” The National Center on Disability and Journalism also says that “special needs” is offensive and should only be used with regard to government references or when used as part of the formal name of an organization or program.

The Bottom Line

Children with special needs, including physical ailments and learning disabilities, may need additional care and support. Their guardians may be able to access financial resources, including tax credits and deductions, that offset extra expenses. Also, families can draw on government-subsidized 澳洲幸运5开奖号码历史查询:health care, financial assistance programs, and grants from 澳洲幸运5开奖号码历史查询:nonprofit organizations.

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