Having a child with special needs makes estate planning important and provides an extra layer of protection for your child. Special needs can give you peace of mind and confidence in the future of other relatives or your child. Too often, families put off the job of planning for the reason that it seems overwhelming and confusing. As you might expect, it is not as tough, it also is the only means to ensure your child with special needs will receive the best care as soon as you can no longer provide care for yourself.
A Letter of Intent or Special Letter of Education is an important component of a special needs plan. It functions as a roadmap for any people involved with your child’s long term maintenance. The Letter of Intent is a document that permits a prospective caregiver to perform your fantasies and handle the requirements of your special child. A final will is a vital component in a special needs strategy. Your final will has directions, such as a special needs trust, for the managing of assets coming to your child with special needs. Without a will, state laws will determine how your assets will be distributed. By preparing a will, you decide how you desire your property to be distributed and you identify the individual (s) that you want to name as the protector of your child or kids.
A common tools used in special needs planning is a special needs trust. The objective of the special needs trust is to protect inherited assets the beneficiary will remain eligible for needs-based government benefits. A supply to a special needs beneficiary may result in a loss of benefits; possibly a tragic outcome. A special needs trust may give you peace of mind knowing that your person will continue to receive the benefits to which they are entitled while preserving the quality of life.
Your planning should consider both, that will function as guardian for the minor children and child with special needs, as well as who will be named as the trustee to oversee the investment, management, and distribution of special needs trust assets. Each of these individuals plays with a role that is distinct and different, which means you will wish to consider your choices and alternates. Planning for the future requires thinking about the type of life you want your kid to have when you are not able to give care. Special needs must be undertaken under the guidance and the counsel of an experienced attorney. This is one area of preparation that should never be a project.
Special Needs Planning Protects
With specialist special needs planning, you may rest assured that cash set aside for a family’s attention will be protected, and not hinder their ability to get different kinds of assistance. Not only do particular needs trusts ensure that allocated funds move directly to paying for the care and needs of your loved one, but also different these funds from possession of your loved one, so that he or she may nonetheless be eligible for financial assistance which may not otherwise be available if the same funds were abandoned right as an inheritance.
Planning for someone with special needs must be done very carefully and with great attention to detail when it comes to financial security. While a straightforward Will may have been sufficient to outline care directions previously, the times have changed drastically. Nowadays, to protect a loved one who has specific needs, a comprehensive estate plan with a focus on special needs planning, is necessary.
As touched on briefly above, the main way of providing for a loved one is to set a Special Needs Trust, so that parents, grandparents or other guardians have access to the capital to pay for caretaking. Setting up a special needs trust is a rather simple process by contacting us you can start.
The main areas of consideration when establishing this type of trust are:
• Who will be the proper guardians for your loved one?
• Who would be a suitable Trustee to manage the trust’s financing?
• Review details concerning education, housing, personal and emotional needs
Our law firm has helped many households build strong special needs programs, geared to offer the best financial and legal security potential. Contact us today for special needs estate planning services information tailored to your circumstances.
Why Special Needs Planning Is A Must
Individuals with mental or physical disabilities oftentimes receive government benefits based on 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 disabled individual or make a bequest to this individual in a will or trust to supplement the government benefits that the person receives. However, by gifting directly to the disabled person, the friend or relative may decrease the number of benefits or even remove the individual’s capability to get government benefits for a while.
Before making such a present you need to take into account the effects that the gift or bequest will possess on any government benefits that the individual receives and that person’s ability to manage the money you want on leaving him. Rather than making a direct gift or bequest (through a will or trust) to that individual, you need to think about setting a special needs or supplemental needs trust to maintain the gift or bequest.
Working with a special requirements or supplemental needs trust permits you to leave considerable assets to a disabled individual (if a minor or adult) while ensuring that: (a) that the benefits that the individual receives will not be impacted by the presence or bequest; (b) the government cannot assert a creditor claim against the land held in trust, and (c) the individual receiving the assets will not improperly use or handle the assets.
The quantity of financial aid or benefits that a disabled person receives from the authorities is calculated depending on the assets which the individual owns or can access. Bequests or gifts made directly to a person may either decrease or eliminate certain types of assistance or benefits. These gifts or bequests increase the number of resources that the person owns that results in the benefits that the individual has been reduced or eliminated until the resources gifted or bequeathed to the person have been used up.
By putting the gift or bequest in a special needs trust or supplemental needs trust for the benefit of the disabled person the property put in the trust may be used to improve a handicapped person’s life by providing for that person’s requirements above and beyond the government benefits that the person 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, by the conditions of the trust, the assets cannot be used to supply for the disabled individual’s basic needs (food, home, certain utilities, and clothing).
A properly drafted special needs or supplemental needs trust makes sure that the disabled person does not have any control over the trust assets or the ability to drive distributions from the trust. Essentially, the trustee of this trust can use the resources to buy various items and services such as special medical equipment for the disabled person not covered with the government benefits, phone bills and cable bills, computers, maid service, and capital improvements to the person’s residence (such as constructing a wheelchair ramp or installing other assistance equipment). The capacity to supply these kinds of conveniences to a disabled individual enables that individual to use the benefits he receives from the authorities to get better housing, clothing and maintain a high standard of living.
In circumstances where an individual is handicapped but doesn’t receive government benefits a special needs trust may be employed to help manage assets that the individual could waste by improper spending or mismanagement. The trustee determines when to create distributions and the way to create these distributions. For instance, the trustee pays a cable bill or telephone bill directly as opposed to providing the money to the individual. Also, the beneficiary cannot order the trustee to create a distribution, which makes assets held at a properly drafted special needs hope.
Therefore, before giving cash or other assets to a handicapped person you should check with a special needs trust attorney to ascertain the very best and most efficient way to enrich that person’s life. It may require setting a trust to benefit the disabled person or it may entail paying the person’s phone bill.