Financial Aid for Special Needs Children and Adults
The cost for caring a child with special needs can be frightening.
In 2022, the Brookings Institute estimated the cost of raising a child from birth to 18 at $310,000. That figure was for a child born in 2015; costs clearly have increased since.
The Center for Disease Control reports that a son or daughter with autism could cost parents an extra $40,000-$60,000 per year, which could add another million dollars to the cost. Most of those expenses come through necessary special services for the child and lost wages related to increased demands on one or both parents.
Autism Speaks, an autism advocacy charity and the largest autism research organization in the U.S., reports the cost of caring for loved ones (children and adults) with autism will total $461 billion by 2025.
Yes, the prospect can be overwhelming.
But take a deep breath. Financial help for parents with a special needs child is available through sources such as the Social Security Administration, Medicaid, insurance, grants, and educational assistance.
Will these sources cover all costs? No. But these special needs assistance programs make financial help possible, and they can make a difference in what the budget looks like as you guide your family into the future.
Supplemental Security Income for Special Needs
Kevin Haney, a parent of a child with a disability, writes online that Supplemental Security Income (SSI) is one of the “foundational government programs” for parents of a disabled child.
SSI is a type of social security benefit and is the only source of federal income reserved for disabled children. It can be a lifeline that keeps a family out of poverty by providing monthly income to meet basic needs for food, clothing, and shelter.
Not every child qualifies and not everyone gets the same amount, but an eligible child can receive up to $914 per month in 2023. The child can receive SSI benefits from date of birth until he or she turns 18 (and perhaps after, if still living with parents).
SSI is geared toward disadvantaged families, so there are income limits applied to the child and the family with whom he or she lives. Social Security’s formula for determining benefits is, shall we say, not simple. The good news: In most states, a child who qualifies for SSI will automatically qualify for Medicaid as well.
SSI states a child has a disability if he or she has a physical or mental impairment or combination of impairments, which cause severe limitations in daily life, and the condition has lasted or is expected to last for at least one year.
Examples that may qualify include Down syndrome, cerebral palsy, autism, intellectual disability (age 4 or older), muscular dystrophy and blindness.
To qualify for SSI, the maximum amount of gross monthly earned income a family can make for a disabled child is $4,238 for a one-parent family, and $5,152 for a two-parent household. The amounts increase if there are more children. If all income is unearned, the monthly limits are $2,325 and $2,782, respectively.
Parents who continue to care for a disabled child after he or she turns 18 can still receive SSI, though the criteria change.
Social Security Survivor Benefits
When a parent who is eligible for Social Security dies, retires or becomes disabled, his or her unmarried children under age 18 (whether they have special needs or not) may be able to collect monthly Social Security Survivor Benefits. A special needs child older than 18 might also be eligible.
The amount the survivor receives depends on the parent’s average lifetime earnings. A child under 18 or a disabled dependent child can receive up to 75% of the parent’s benefit.
In addition to the surviving children, among those who typically receive Social Security Survivor benefits are widows or widowers who are 60 or older (or 50 or older if they are disabled), and widows or widowers of any age who are caring for a child who is disabled or under the age of 16.
Normally, the disabled child benefits end when a child turns 18. But a child who has a qualifying disability and who has been receiving Survivor Benefits up to the age of 18 could continue to receive Disabled Adult Child (DAC) benefits for the rest of his or her life.
Temporary Assistance for Needy Families (TANF)
The federal program Temporary Assistance for Needy Families (TANF) provides low-income parents with temporary financial help to care for their children in the home. Eligibility requirements and monthly amounts vary by state.
In July of 2022, New Hampshire provided $1,151 per month, Illinois $549, and Ohio $542, according to the Center on Budget and Policy Priorities (CBPP). The CBPP said that as of July ’22 “cash benefits are at or below 60 percent of the poverty line in every state and below 20 percent in 15, mostly Southern, states.”
Assistance is for the needy, so it is not limited to families with disabled children.
Supplemental Nutrition Assistance Program (SNAP)
This program formerly was known as food stamps, but the emphasis remains the same: Helping the needy buy food for themselves and their family.
The Supplemental Nutrition Assistance Program (SNAP) provides an electronic debt card with money loaded on a monthly basis. Those between 18 and 50 years of age can receive SNAP benefits for three months every three years unless they are working or in a training program at least 20 hours per week.
Benefit amounts are determined by monthly income less 30%, the amount the government expects us to contribute to sustaining a family. In 2023, the maximum for a family of three was $740 per month, with an expected average of $577.
Household income generally must be below 130% of the poverty line. For a family of three in 2023, the poverty line is $1,920 per month. Which means that family’s income limit to qualify is $2,496 per month; families of three that earn more per month do not qualify. The poverty level increases for bigger families and decreases for smaller ones.
According to the CBPP, 36% of SNAP recipients are in families with members who are elderly or disabled.
If there is a veteran in the immediate family, the Veterans Administration factors dependent children into the available benefits package. In addition to monthly payments for low-income veterans, a VA pension can provide financial support for dependents and survivors, including minor children as well as adult children who became disabled before the age of 18.
The program is called Veteran’s Aid and Attendance, and it includes a monthly cash payment to veterans whose income is under a certain level. The payment is increased if the vet has a dependent child.
Eligibility for a VA pension doesn’t depend on the veteran having a service-related disability. Rather, it is intended for wartime veterans who are 65 and older or who are permanently and totally disabled, and who are living on limited income.
Outside of its pensions, the Veterans Affairs offers tax-free disability compensation to veterans who were injured while on active duty, and the monthly payments can be increased if the veteran has dependent children.
VA benefits include the Dependency and Indemnity Compensation (DIC) for survivors of a veteran who died or sustained a serious disability while serving. A DIC provides monthly payments for minor children and, under some circumstances, a disabled adult child.
If the surviving child is disabled, he or she may be eligible for disability benefits through a VA health care cost-sharing plan available through one of several programs. One is an insurance program administered by the Civilian Health and Medical Program of the Department of Veterans Affairs (CHAMPVA). Another is the TRICARE insurance program through the Department of Defense.
The VA also has a number of similar programs related to a veteran’s service-connected disability.
Government programs and private insurance are primary ways to help offset the cost of treating children with special health care needs. Medicaid helps low-income individuals and families with health care coverage. The Children’s Health Insurance Program (CHIP) provides low-cost health coverage to children in families that earn too much money to qualify for Medicaid but not enough to buy private insurance.
Medicaid and CHIP, which is run by states under federal rules, have financial eligibility limits, but in most states, they extend above the poverty line. In 2023, the median financial eligibility level for Medicaid and CHIP children was 255% ($58,752 per year for a family of three) of the federal poverty level.
In general, Medicaid will provide free health insurance for the family, including dental insurance. It may fund day programs for special needs adults and provide some compensation for family caretakers.
It pays to learn what your insurance does and doesn’t cover, and you should be willing to challenge insurance companies when they deny payments or services.
Those who qualified for continuous enrollment in Medicaid during the pandemic should be aware that special benefit will end May 2023. All who receive Medicaid and CHIP should know that they may or may not continue to qualify and should check with their state official if they have questions.
Tax Credits for Special Needs Families
A close scrutiny of what’s available in the way of tax breaks and loopholes can help come tax time. Taking advantage of tax deductions and credits can provide another important outlet to lessen the financial impact of providing help for a special needs child.
This starts with deducting unreimbursed medical expenses when filing federal income taxes. You can deduct the amount that exceeds 7.5% of your adjusted gross income. If your adjusted gross income is $50,000, the threshold is $3,750. So, if you had $10,000 in medical expenses, you could deduct $6,250. The deductible expenses include more than just medicines and doctor bills; medically required foods, mileage to and from health care visits and therapy supplies count, too.
The child and dependent care credit is a tax break for paying someone to care for your child while you work or look for work. The good news is there is no age limit if the child is disabled. The better news is it’s a credit rather than a deduction, so it lowers your tax bill directly instead of just reducing your taxable income. The credit can be up to $3,000 per dependent or a maximum of $6,000 for all dependents. Child-care, after-school programs, and day camp qualify for the credit. Keep good records and consult your accountant.
Another break is a 529A account, which are state-sponsored accounts that allow disabled people to save significant amounts without threatening their eligibility for need-based government help. Disabled people, their families and friends can contribute as much as $15,000 a year without putting federal benefits at risk. These are not deductible on federal taxes, but some states allow them as deductions. The permissible size of the account also varies by state.
Special Needs Grants
Grants are available that provide financial help for a special needs child. The need criteria and income requirements vary greatly, the funds are not unlimited, and a lot of people may be seeking the grants at the same time, so the process of obtaining one might not be seamless.
Still, a grant that means free money for disabled persons can be well worth pursuing.
Sources for some of the grants for parents with special needs children include:
- Alyssa V. Phillips Foundation – Provides financial support to those impacted by Cerebral Palsy so they can receive ongoing and necessary therapy or equipment not covered by insurance.
- Aubrey Rose Foundation – Helps families with children who are currently living with a life-threatening medical condition.
- Autism Care Today SOS Program – Supports those impacted with autism who have an immediate need for treatment or support and whose safety is jeopardized if treatment is not found.
- Believe in Tomorrow – Pediatric hospital housing and respite housing.
- Blind Citizens – Assistive Technology Fund (ATF) provides funds to cover 50% of the retail price of adaptive devices or software.
- Byron Riesch Paralysis Foundation – Provides assistance to those that suffer from neurological disorders.
- Different Needz Foundation – Offers special needs families a one-stop shop to buy and sell their gently used medical and special needs equipment and adaptive toys. They also have a grant available to purchase such items as well.
- Disabled Children’s Relief Fund – Provides assistance to obtain wheelchairs, orthopedic braces, walkers, lifts, hearing aids, eyeglasses, medical equipment, physical therapy, and surgery.
- Fans Across America – Community of sports and entertainment fans committed to providing much needed financial assistance to families with seriously ill and special needs children.
- Federal Grant Wire – 60 children’s federal grants, government grants and loans.
- Financial Resources and Discounts for Students with Disabilities – guide to various financial resources, discounts and savings opportunities, and travel tips for students with disabilities.
- First Hand Foundation – Assists children with clinically relevant, health-related needs and no financial resources to cover these expenses.
- Flyin Ryan Foundation – Adventure scholarships based on financial need, character which reflects Ryan’s principles of living, and demonstrated passion to pursue your adventure of choice.
- Gia Nicole Angel Foundation – Enhances the daily functioning of a child with special needs and his or her family by awarding assistance through the purchase of a specific item or items.
- Giving Angels Foundation – Enhances the lives of children under the age of 21 with any type of physical disability or illness.
- Hands to Angels – Grants to support the identification and eventual prevention of rare, genetic disorders and to provide financial assistance to families coping with these disorders.
- The Jiselle Lauren Foundation – Helps any family whose child has a special need or disability achieve things that wouldn’t be possible otherwise.
- Kiddie Pool – Works as a fundraiser to help families raise money for special adaptive equipment.
- Laila Rose Foundation – Provides financial assistance to families of children with medical needs.
- The LENN Foundation – Helps children with cerebral palsy by providing financial relief for medical needs.
- Lori’s Voice – Enriches the lives of children with muscular, neurological, and other degenerative diseases.
- McLindon Family Foundation – Provides adaptive bikes to children with special needs.
- Morgan Project – Provides resources, gently used disability equipment and small grants.
- The Federation for Children with Special Needs – Provides support, resources, and assistance.
- The Oracle Health Foundation – Provides funding for items to improve the quality of life of individuals with disabilities not otherwise covered by insurance.
- Partnership for Prescription Assistance – Helps qualifying patients without prescription drug coverage get the medication they need through the program that is right for them. Many will get their medication for free or nearly free.
- Pediatric Angel Network – Providing relief and hope to families with an ill or disabled child during a difficult time.
- United Spinal Association – Has a list of grants for children with spinal conditions and other disabilities.
- Variety Children’s Charity – Helps kids gain mobility, confidence, freedom, independence, and the chance to join in the life of their community by providing funding for walkers, wheelchairs, specially-designed adaptive bikes, strollers, prosthetic limbs and other devices to families with the most need.
Housing Assistance For Families with Disabled Children
Given the reality that rent, or a mortgage can be a significant monthly cost, it’s good to know what housing aid is available to families with disabled children. The help comes in the form of housing grants or aid to modify the home for the disability.
Housing grants are available to families with disabled children. This is important because many caretakers sacrifice work hours and income to care for their child.
The one proviso: The federal government only gives grants to families buying their first home. Aid to those who have already purchased a home usually comes in the form of state agencies or nonprofit grants.
Home modifications to take care of the disabled child are tax deductible, provided the modifications are medically necessary adaptations. A doctor should write a note for each modification needed, and the note should be kept in a safe place. This provides proof of the need for the deduction; in case the IRS asks.
Federal help comes in three forms. The Section 811 Supportive Housing for Persons with Disabilities program provides financial advances and rental assistance contracts to low-income households with at least one family member with a disability. The Project Rental Assistance program provides help to low-income families with at least one adult member with a disability.
The Section 8 Rental Housing Choice Vouchers are the government’s main way to help the elderly and disabled afford safe and decent housing in the private market. Housing choice vouchers are administered by local Public Health Agencies (PHAs). The subsidy is paid directly to the landlord.
The FHA has a web page that lists down payment grants and links available by state. Recipients must apply for the specific grant funding.
Remember: Most of this aid is available only to low- or very low-income families.
Government programs can provide help for specific disabilities, especially for children with cerebral palsy or autism.
Adaptations for a child with cerebral palsy include widening of hallways or doors, installing hardwood floors, or purchasing stair lift chairs.
For those with autism, adaptations may include removing fluorescent lights for LEDs, upgrading blinds or shades to limit light in a room, installing soundproof panels and curtains, or installing surveillance cameras to alleviate anxiety the child may feel about an intrusion.
A fair amount of financial aid via scholarships and awards is directed toward students with special needs and learning disabilities. They can be found with a simple Internet search. Here are a few, ordered by disability.
Attention Deficit Disorder
The Fred J. Epstein Youth Achievement Award is an annual award of $1,000 that recognizes the strengths and accomplishments of young people with learning disabilities and ADHD. It is given to a student 19 or younger who has demonstrated initiative, talent and determination resulting in a notable accomplishment in any field.
The Michael Yasick ADHD Scholarship by Shire isa $2,000 scholarship to students in the U.S. who have been diagnosed with ADHD and are planning to pursue higher education.
The Organization for Autism Research (OAR) offers two nonrenewable $3,000 scholarships for students on the autism spectrum who are full-time students working toward certification or accreditation in a particular field. A third scholarship goes to autistic students of color.
A number of other autism scholarships are linked here.
Learning and Cognitive Disabilities
National Center for Learning Disabilities (NCLD) Scholarships – The NCLD offers four annual scholarships and awards. They include the $10,000 Anne Ford Scholarship ($2,500 per year over four years) that goes to a graduating high school senior who will attend a four-year bachelor’s degree program, and the $5,000 Allegra Ford Thomas Scholarship ($2,500 over two years) to a graduating high school senior who will enroll in a two-year community college, a vocational or technical training program, or a specialized program for students with a learning disability or ADHD. Recipients must demonstrate financial need and be involved in school and community activities.
Landmark College Scholarships – Landmark College is one of only two colleges in the country specifically for students with learning disabilities. Multiple scholarships ranging from $1,500 to $34,000 are available for students and are based on financial aid and merit.
The National Federation of the Blind and the American Council of the Blind offer scholarships. The Lighthouse Guild offers up to 20 merit-based scholarships awarded each year to legally blind high school students getting ready to attend college, as well as an annual scholarship to at least one qualifying graduate student.
A list with links of other scholarships available to the blind can be found here.
Microsoft Disability Scholarship – Awarded to promising high school students with financial need who plan to attend a vocational or academic college. This scholarship provides $5,000 per year up to a total of $20,000 and is designed for students who seek a career in the technology industry.
Grants for Children in Wheelchairs
Money via grants is available from several organizations and charities. These grants could include money for the wheelchair itself, or to adapt your car to wheelchairs. Among them:
- The Maggie Welby Foundation – provides grants to help with medical bills, to modify your vehicle, or just pursue an opportunity that otherwise would not be available to your child.
- The Parker Lee Project – helps cover the cost of equipment and medical treatment not covered by insurance. Parker Lee also provides excellent educational help and support to parents of disabled children.
- The Different Needz Foundation – provides grants to those with disabilities focusing on what they may need in the future. Help could involve financial assistance or equipment needs.
- The Oracle Health Foundation – (formerly the Center Charitable Foundation and the First Hand Foundation) provides funding for items that will improve the quality of life for a person with disabilities that may not be covered by health insurance. It also can provide financial relief for medical bills.
- Wheelchairs 4 Kids – provides the highest quality wheelchairs for children who need them. In addition, Wheelchairs for Kids can help with grant money for wheelchair ramps to home modifications to wheelchair accessible vehicles.
Financial Assistance for Disabled Adults
Programs are in place to provide financial assistance for adults with special needs. That group lives in poverty at much higher percentages than the general population. According to the Bureau of Labor Statistics, only 21% of people with a disability were employed in 2022.
The first place to look for help is the Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) programs.
To qualify for SSDI, you must have held jobs that were covered by Social Security and have a disability that meets Social Security’s requirements. Those approved will receive monthly cash benefits. Those denied can file a disability appeal and potentially still be awarded benefits.
SSI is funded by tax revenue rather than Social Security and is designed for disabled people who don’t have sufficient income.
The Social Security Administration’s Benefit Eligibility Screening Tool is where to find out if you qualify.
The federal Temporary Assistance for Needy Families (TANF) program gives funds to states and territories to provide families with financial assistance and related support services to meet people’s basic needs. State-administered programs may include childcare assistance, job preparation, and work assistance. To find out what your state offers, visit The Office of Family Assistance.
The U.S. Department of Housing and Urban Development offers housing vouchers to non-elderly disabled families to help qualifying families pay their rent. The Supplemental Nutrition Assistance Program (SNAP) offers assistance to low-income families by giving benefits for food. You can use SNAP benefits at grocery stores to help keep food on the table.
People in these programs might also qualify for the Low-Income Home Energy Assistance Program, a service that provides money to pay utilities.
» Learn More: What to Do When You Can’t Afford Rent
Although a child with special needs can mean years of challenges that might greatly impact your financial situation, you don’t have to do this alone. Take advantage of the programs mentioned above that provide financial aid for a special needs child and be on the lookout for others.
A nonprofit credit counseling agency can help you over the budgeting hurdles as you are taking care of a child or adult with special needs. The right credit counseling will tailor its financial advice to your specific resources and needs, and vastly improve your situation.
If your finances are already suffering, a nonprofit credit counseling agency can help you get back on fiscal track and stay there.
About The Author
Max Fay has been writing about personal finance for Debt.org for the past five years. His expertise is in student loans, credit cards and mortgages. Max inherited a genetic predisposition to being tight with his money and free with financial advice. He was published in every major newspaper in Florida while working his way through Florida State University. He can be reached at [email protected].
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