Having a child with special needs offers an excess layer of protection and makes estate planning important. Special needs planning can give you peace of mind and confidence in the future of your child or other family members with special needs. Families put off the job of planning for the reason that it seems confusing and overwhelming. As you may expect, however, it is not quite as difficult, it also is the only way to make sure your child with special needs will receive the best care as soon as you can no longer provide that care yourself.
A Letter of Intent or Special Letter of Education is an important component of a special needs strategy. It functions as a roadmap for almost any individual involved with your child’s future maintenance. The Letter of Intent is a document that permits a caregiver to handle the requirements of your child and to carry out your wishes. A final will is also an essential element in a special needs strategy. Your final will has directions, such as a special needs trust, for the management of assets passing to your kid. Without a will, state laws will determine how your assets will be dispersed. By preparing a will, you decide how you desire your property to be distributed and you also identify the person(s) you wish to title as the guardian of your child or children.
Typical tools used in special needs planning is a special needs trust. The purpose of the special needs trust is to protect inherited assets the beneficiary will continue being eligible for needs-based government benefits. A supply to a special needs beneficiary might lead to a loss of benefits; possibly a tragic result. A special needs trust can give you peace of mind knowing your person will continue to receive the benefits to which they’re entitled while maintaining a quality of life.
Your preparation should contemplate both, who will be the guardian for your minor children and child with particular needs, as well as who will be named as the trustee to oversee the investment, management, and supply of special needs trust assets. Every one of these individuals plays with a role that is distinct and separate, which means you might wish to carefully think about your options and alternates. Planning for the future requires thinking about the type of life you want your kid to have when you are no longer able to provide care. Special needs planning should only be undertaken under the counsel and advice of an experienced attorney. That is 1 area of preparation that shouldn’t ever be a job.
Special Needs Planning Protects
With professional special needs planning, you may rest assured that cash set aside for a family’s attention will be protected, as well as not hinder their ability to get other kinds of assistance. Not only do special needs trusts ensure that allotted funds go straight to paying for the care and needs of your loved one, but also separate these funds from ownership of your loved one, so that he or she may still qualify for financial assistance that might not otherwise be accessible if the same funds were left-right as an inheritance.
Planning for someone with special needs must be done very carefully and with good attention to detail in regards to financial security. Even though a straightforward Will might have been sufficient to outline care instructions previously, the times have changed considerably. Now, to protect a loved one who has specific needs, a thorough estate plan with a focus on special needs planning, is necessary.
As touched on briefly above, a primary way of providing for a loved one would be to set a Special Needs Trust, so that parents, grandparents or other guardians have access to the funds to cover caretaking. Setting up a special needs trust is a relatively straightforward process by calling us, you can begin now.
The main Regions of consideration when setting up this type of trust are:
• Who’ll be appropriate guardians for the loved one?
• Who would be an appropriate Trustee to manage the trust’s finances?
• Outline details about education, housing, personal and emotional needs
Our law firm has helped many families build strong special needs plans, geared to provide the best financial and legal security possible. Contact us now for specific needs preparation information tailored for your situation.
Why Special Needs Planning Is A Must
People with mental or physical disabilities regularly receive government benefits according to their financial needs. The majority of the time these benefits are inadequate to meet the disabled individual’s requirements, and relatives and friends want to make gifts to a handicapped person or make a bequest to that person in a will or trust to supplement the government benefits that the person receives. However, by devoting directly to the disabled person, the relative or friend may decrease the number of benefits or perhaps eliminate the individual’s capability to receive government benefits for a while.
Before making such a present, you want to consider the effects the gift or bequest will possess on any government benefits that the person receives and also that person’s ability to manage the money you intend on leaving him. Rather than making a direct gift or bequest (via a will or trust) to that person, you should think about establishing a special needs or supplemental needs trust to hold the gift or bequest.
Using a special requirements or supplemental needs trust allows you to render substantial assets to a disabled person (if a minor or adult) while ensuring that: (a) that the benefits that the individual receives won’t be impacted by the gift or bequest; (b) the authorities cannot argue a creditor claim against the land held in trust, and (c) the individual receiving the assets will not improperly use or manage the resources.
The quantity of financial assistance or benefits a disabled individual receives from the authorities is calculated based on the assets which the person owns or can access. Bequests or gifts made to a person may reduce or eliminate specific kinds of support or benefits. Essentially, these gifts or bequests raise the number of assets that the individual owns that results in the benefits that the person has been reduced or removed until the assets gifted or bequeathed to the person have been consumed.
By putting the gift or bequest at a special needs trust or supplemental needs trust for the benefit of the disabled individual the property put in the trust may be used to improve a disabled person’s life by supplying that person’s needs above and beyond the government benefits which the individual receives without reducing or eliminating the benefits obtained. The assets owned by the trust are not considered the disabled person’s assets since the patient does not have any control over the assets and also, from the terms of the trust, the assets cannot be employed to supply for the disabled person’s basic needs (food, home, specific utilities, and clothing).
A properly drafted special requirements or supplemental needs trust ensures that the disabled person doesn’t have any control over the trust resources or the capacity to compel distributions from your trust. Essentially, the breach of this trust may use the resources to buy various items and services like special medical equipment for the handicapped individual not covered by the government benefits, telephone bills and cable bills, computers, maid services, and capital improvements to the person’s residence (such as constructing a wheelchair ramp or installing other help equipment). The ability to supply these types of amenities to a disabled individual enables that individual to utilize the benefits he receives from the authorities to obtain better housing, clothes and maintain a higher quality of living.
In situations where an individual is disabled but does not receive government benefits a special needs trust may be used to manage assets which the individual could potentially waste by improper spending or mismanagement. The trustee decides to make these distributions and when to make distributions. As an example, the trustee pays a cable bill or phone bill directly rather than giving the funds to the person. Also, the beneficiary cannot dictate the trustee to make a supply, which makes assets held in a properly drafted need hope.
Therefore, before giving money or other assets to a handicapped person who you need to consult with an Estate planning lawyer to ascertain the best and most effective method to enrich that individual’s life. It could require setting a trust to benefit the individual throughout their lifetime or it may involve paying the individual’s phone bill straight.