It’s important to be able to properly deal with disabled beneficiaries in a will. In some cases, there’s a legal obligation to support disabled beneficiaries. Under Alberta’s Wills and Succession Act (section 88), spouses, adult interdependent partners (sometimes called common law partners), minor children, disabled adult children, and sometimes even grandchildren can make a claim against your estate if they’re financially dependent on you and they haven’t been adequately provided for in your will. In the case of minor children or disabled dependents, the Public Trustee (the government department that oversees the finances of minors and the disabled), may even take up estate litigation on behalf of dependents who haven’t been provided for adequately under a will.
It’s also important to plan a gift to a disabled beneficiary in such a way that the beneficiary won’t miss out on other benefits they may be entitled to receive. In Alberta, some disabled people receive government support known as AISH (Assured Income for the Severely Handicapped). AISH eligibility ends when the disabled recipient has assets that exceed a certain value, currently $100,000. However, if an AISH recipient owns certain assets (a house, a vehicle, reasonable household items, clothing, a registered disability savings plan or RDSP) or is a beneficiary of a trust, that won’t affect AISH eligibility.
The key takeaway is that providing for disabled dependents is an important issue in estate planning. If you have a disabled family member who is financially reliant on you, you should discuss this with your lawyer when you’re doing your will.