When a parent of a child with special needs retires and begins receiving Social Security retirement benefits, her child may qualify for Social Security Disability Insurance (SSDI) based on the parent's work record if the child's disability manifested itself before the child turned 22 years old. But a little-known provision in the Social Security regulations allows the spouse of a retiree to also receive Social Security benefits, even if he has not yet reached retirement age, so long as he is caring for a child with disabilities at home.

Here's an an actual example. Father retires and begins receiving Social Security. Because his daughter developed a disability prior to turning 22, the daughter will begin receiving SSDI benefits at this point. Furthermore, because the 58-year-old mother is caring for the couple's daughter at home, she may also begin receiving spousal Social Security benefits, even though she hasn't reached the minimum retirement age.

Of course, there is a catch. Because the combination of the mother’s and daughter's benefits exceeded Social Security's limit on family benefits, the result was that the daughter's benefit was reduced. But the combined benefit still exceeded the daughter's benefit alone by more than $500 a month. Over the four years from when the father began taking Social Security benefits until the mother reaches age 62, the family will receive more than $30,000 in extra benefits, which will make a large difference in their ability to care for their daughter.

To paraphrase the Social Security Administration's (SSA) website, in order for a parent to receive benefits in this situation, the parent must exercise parental control and responsibility for a mentally disabled child. The benefits can also be received if the parent performs personal services for a child who is physically disabled.

In many cases, the SSA will inform the parent of this opportunity, so long as the parent is already receiving spousal benefits before the child turns 16. But if the parent is not receiving these benefits, it is important to explain the situation to the SSA when the retiring parent applies for Social Security.

Since this area of benefits planning is very complicated, it is important to speak with your special needs planner in order to fully analyze your Social Security retirement options. One wrong turn could result in a significant reduction in Social Security benefits.