PFS Special Education Support 3

Question 1

A client wants to leave assets to a child with severe autism without jeopardizing government benefits. The BEST planning tool is:

Accepted Answer

A third-party special needs trust

Answer

A third-party special needs trust supplements government benefits without counting as a resource for Medicaid or SSI eligibility purposes.

Question 2

Under IDEA, the document that outlines the specific educational services a disabled student will receive is called the:

Accepted Answer

Individualized Education Program (IEP)

Answer

An IEP is the legally binding document detailing special education goals, services, and accommodations for a student eligible under IDEA.

Question 3

When a first-party (self-settled) special needs trust is terminated, any remaining funds after the beneficiary's death must first be used to:

Accepted Answer

Reimburse the state for Medicaid benefits paid

Answer

First-party special needs trusts include a Medicaid payback provision requiring the state to be reimbursed for benefits paid during the beneficiary's lifetime.

Question 4

The annual contribution limit to an ABLE account from ALL sources (including the account owner) is tied to:

Accepted Answer

The annual gift tax exclusion amount

Answer

The base annual ABLE contribution limit equals the federal annual gift tax exclusion (currently $18,000 in 2024), though working beneficiaries may contribute more.

Question 5

A special needs child inherits an IRA directly from a grandparent. What is the primary financial planning concern?

Accepted Answer

Required minimum distributions may disqualify the child from SSI

Answer

RMDs from an inherited IRA count as unearned income and could push the child over the SSI income threshold, jeopardizing benefits.

(PFS) Personal Financial Specialist Practice Test

(PFS) Personal Financial Specialist Practice Test

PFS Special Education Support 3