What Should I Be Thinking About Now That My Disabled Child Is Turning 18?

For many, turning 18 is a milestone birthday. They can vote, enter the military, or change their name. They are also able to make their own financial and medical decisions. On a person’s 18^th birthday, they become a legally emancipated adult. This is true for a disabled individual, too, making the 18^th birthday a potentially scary milestone for parents with a disabled child. For this reason, proper planning is important. Without advance planning, the disabled 18-year-old adult child has the same legal rights to make decisions about their finances, personal life, and health care as any other 18-year-old. However, determining the appropriate plan depends, in large part, on the needs of the special needs individual.

Decision Making

Capacity generally refers to one’s ability to process information relevant to making a decision, understanding the consequences of the decision, and communicating that decision.

To the extent the individual has capacity, executing a Durable Power of Attorney (N.J.S.A. 46:2b-8.1) and Advance Directive for Health Care (N.J.S.A. 26:2H-53) allows the adult child to maintain his or her autonomy while also receiving support from the agent designated. A Power of Attorney appoints an agent to make financial and legal decisions on behalf of the individual, while the Advance Medical Directive appoints a representative to make medical decisions. In both cases, the individual has the ability to make his or her own decisions unless and until he or she is deemed incapacitated by a medical professional. It should be noted that, specifically with regard to the Power of Attorney, if the document does not state that the Agent’s authority to act begins only upon a declaration of incapacity by a treating physician, then the agent has the authority to act on behalf of the individual once the document is signed.

If a child lacks capacity and thus cannot execute a Power of Attorney or Advance Directive, filing for guardianship may be necessary. In New Jersey, guardianships are governed by N.J.S.A. 3B:12-24.1 and N.J.S.A. 3B:12-36. The petitioner can request guardianship over the person (for healthcare decisions) and/or property (for financial decisions) and can seek to have a limited guardianship (a guardianship for certain decisions) or a plenary guardianship (a guardianship for all decisions). Guardianship is the most restrictive form of intervention as it strips the disabled individual of his or her autonomy in a manner consistent with the Order of the court. As such, families should resort to an application for guardianship only if the disabled individual is incapable of executing a Power of Attorney and Advance Medical Directive.

In an effort to support the disabled individual’s autonomy and right to self-determination, a supported decision-making agreement offers an alternative to families that are not in need of a guardianship. While supported decision making is not yet codified in New Jersey, professionals continue to advocate for this structure. A supported decision-making agreement, to the extent one is prepared, is between the disabled individual and the parent (or other adult) who will support the individual in his or her decision making. The goal is to help the disabled individual better understand the options presented to him or her and thus come to a fully educated decision. This is not a replacement for a Power of Attorney or Medical Directive.

Government Benefits

In addition to the issue of decision making, an individual turning 18 may be eligible for certain means-tested government benefits that can help support his or her ongoing care needs, including Supplemental Security Income (“SSI”) and Medicaid. Eligibility for these benefits is based on resources and disability. Specifically, an individual’s resources cannot exceed $2,000 and, in the context of SSI, he or she must demonstrate an inability to sustain gainful employment (POMS SI 01110.003). Someone who is eligible for SSI is categorically eligible for Medicaid.

Medicaid is a health insurance program at its core, intended to cover routine medical expenses and long-term care costs. SSI is a monthly stipend that is intended to cover the cost of shelter (historically, food and clothing were on this list too). The SSI benefit is set by the federal government each year, and individual states may offer a state supplement. The monthly benefit for 2026 is $994. The New Jersey state supplement in 2026 is just over $30 per month. The reader should note that the SSI benefit is reduced dollar-for-dollar, up to a maximum of one-third, when the disabled individual is receiving financial support (from a family member or a trust) for housing expenses.

When the disabled child turns 18, the Social Security Administration no longer considers the parents’ income and resources in determining the child’s eligibility for SSI. Instead, only the child’s income is considered (POMS SI 01320.550). As such, the disabled individual may now qualify for benefits under the adult disability standard (POMS SI 00501.001).

For most residential programs in New Jersey, Medicaid (and possibly SSI) are required. In addition, an application to the Division of Developmental Disabilities may be necessary, as Medicaid’s home- and community-based waivers will be the source of funding for most residential programs. It is important to understand the individual’s needs before determining what programs might be appropriate for them. However, applying for Medicaid and SSI is often the starting point for this discussion, as most residential programs do not offer a private-pay option.

Special Needs Planning

If the disabled individual is receiving means-tested benefits, it is important to ensure that nothing will jeopardize those benefits. For example, making a financial gift or leaving an inheritance outright to the disabled individual can be a costly mistake. Establishing and funding a properly drafted Supplemental Needs Trust (“SNT”) is a way to safeguard the disabled individual’s means-tested benefits. The trust would supplement, not supplant, the individual’s means-tested benefits, which means that the trustee of the SNT may cover expenses on behalf of the disabled individual that are not otherwise covered by Medicaid or SSI.

When parents or other family members are engaging in their own estate planning, they will likely establish a third-party SNT. The trust can be established during the grantor’s lifetime or upon the grantor’s death. Because the trust is funded with assets belonging to someone other than the disabled beneficiary, there is no requirement that Medicaid be paid back upon the beneficiary’s passing. Instead, the grantor of the trust directs how the funds should be distributed.

If proper planning is not done, or the disabled individual receives an award from a personal injury lawsuit (for example), then the disabled beneficiary can establish a first-party, or self-settled, SNT. Because this is an exception trust, there are many restrictions. First and foremost, if the disabled individual does not have capacity to establish the trust on his or her own, it can only be established by a parent, grandparent, legal guardian or the court (42 USC 1396p(d)(4)(A), (POMS SI 01120.203)). The disabled individual must be under the age of 65 and disabled when the trust is established and funded. Further, the trust must be maintained for the sole benefit of the beneficiary and must include a Medicaid payback provision. New Jersey codified the provisions that must be included in a self-settled trust if seeking Medicaid approval (N.J.A.C. 10:71-4.11).

There are many tools that families can use to navigate the transition of their disabled child’s life into adulthood. Working with a special needs planning attorney to help navigate these complex issues will ease the transition for the family and for the disabled individual.

Reprinted with permission from the March 24, 2026, issue of the New York Law Journal. © 2026 ALM Global Properties, LLC. All rights reserved. Further duplication without permission is prohibited, contact 877-256-2472 or [email protected].