A child makes estate planning important and offers an extra layer of security. Special needs can give you peace of mind and confidence in the future of your child or other relatives. Too often, families put the task of planning for the reason that it seems overwhelming and confusing. As you may anticipate, however, it is not as tough and is the sole means to make sure your child with special needs will receive the best care as soon as you can no longer provide care yourself.
A Letter of Intent or Particular Letter of Education is an important component of a special needs strategy. It functions as a roadmap for any individual. The Letter of Intent is a working document that enables a future caregiver to carry out your fantasies and handle the requirements of your particular child. A will is an essential element in a special needs strategy. Your will has directions, such as a special needs trust, for the managing of assets passing to your child. Without a will, state laws will determine how your assets will be dispersed. By preparing a will, you decide how you desire your estate to be distributed and you also identify the person(s) you want to title as the guardian of your child or kids.
A common tools used in special needs planning is a special needs trust. The purpose of the special needs trust is to safeguard assets so the beneficiary will continue being qualified for needs-based government benefits. A supply to a special needs beneficiary may result in a loss of benefits; potentially a tragic outcome. A special needs trust may give you peace of mind knowing that your special person will continue to receive the benefits to which they’re entitled while preserving a greater quality of life.
Your planning should contemplate both, who is going to function as guardian for your minor children and child with particular needs, and who will be termed as the trustee to oversee the investment, management, and distribution of special needs trust resources. Each of these individuals plays with a function that is separate and distinct, which means you will want to consider your choices and alternates. Planning for the future requires thinking about the type of life you would like your kid when you are able to give the care to have. Special needs must be undertaken under advice and the counsel of a lawyer. This is one area of preparation that should never be a job.
Special Needs Planning Protects
With professional special needs planning, you can rest assured that cash set aside to get a family’s attention will be protected, as well as not interfere with their capacity to receive different sorts 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 separate these funds from ownership of your loved one, so that he or she may nonetheless qualify for financial aid that might not otherwise be accessible if the same funds were abandoned right as an inheritance.
Planning for someone with special needs have to be carried out very carefully and with great attention to detail when it comes to financial security. Even though a simple Will may have been enough to outline care directions in the past, the times have changed considerably. Now, to protect a loved one with a comprehensive estate plan with a focus on special needs planning, specific needs, is necessary.
As touched on briefly above, the main way of providing for a loved one would be to establish a Special Needs Trust, to ensure parents, grandparents or other guardians have access to the funds to cover caretaking. Preparing a special needs trust is a process you can begin today by contacting us. Click here.
The primary Regions of consideration when establishing this type of trust are:
• Who’ll be appropriate guardians for your loved one?
• Who will be an appropriate Trustee to manage the trust’s financing?
• Review details concerning education, housing, personal and emotional needs
Our law firm has assisted many families to build strong special needs programs, aimed to offer the best financial and legal security potential. Contact us for specific needs planning information tailored for your specific circumstance.
Why Special Needs Planning Is A Must
Individuals with mental or physical disabilities oftentimes receive government benefits according to their financial needs. Most of the time these benefits are insufficient to meet the disabled person’s requirements, and relatives and friends wish to make gifts to a disabled person or make a bequest to that individual in a will or trust to supplement the government benefits that the individual receives. However, by gifting straight to the handicapped person, the relative or friend may decrease the number of benefits or perhaps remove the individual’s ability to receive government benefits for a while.
Before making this kind of gift you want to take into account the effects that the gift or bequest will have on any government benefits which the person receives and that person’s capability to handle the money you intend on leaving him. As opposed to making a direct gift or bequest (via a will or trust) to this individual, you need to consider establishing a special needs or supplemental needs trust to hold the gift or bequest.
Working with a special needs or supplemental needs trust allows you to leave considerable assets to a disabled individual (whether a minor or adult) while ensuring that: (a) that the benefits that the person receives will not be affected by the gift or bequest; (b) the authorities cannot argue a creditor claim against the property held in trust, and (c) that the individual receiving the assets won’t improperly use or handle the assets.
The amount of financial assistance or benefits that a handicapped person receives from the authorities is figured based on the assets that the individual owns or can access. Gifts or bequests made directly to a person may reduce or remove specific types of support or benefits. Basically, these gifts or bequests increase the number of assets which the individual owns which results in the benefits that the person receives being reduced or removed until the assets gifted or bequeathed to the individual have been used up.
By putting the gift or bequest at a special needs trust or supplemental needs trust for the benefit of the handicapped person the property put in the trust can be used to improve a handicapped individual’s life by providing for that individual’s needs above and beyond the government benefits that the person receives without decreasing or removing the benefits obtained. The assets owned by the trust are not considered the disabled individual’s assets since the individual doesn’t have any control over the assets and also, from the conditions of the trust, the resources cannot be used to supply for the disabled individual’s basic needs (food, home, specific utilities, and clothing).
A properly drafted special needs or supplemental needs trust ensures that the disabled individual does not have any control over the trust resources or the ability to compel distributions from your trust. Essentially, the trustee of the trust may use the resources to buy a variety of items and services such as special medical equipment for the disabled individual not covered by the government benefits, phone bills and cable accounts, computers, maid service, and funding improvements to the individual’s residence (like building a wheelchair ramp or installing other help equipment). The ability to supply these kinds of amenities to a handicapped individual allows that person to use the benefits he receives from the government to get better housing, clothes and maintain a higher quality of living.
Even in circumstances where an individual is handicapped but doesn’t receive government benefits a special needs trust may be used to manage assets that the person could waste by improper paying or mismanagement. The trustee determines when to make distributions and how to make these distributions. As an instance, the trustee pays a cable bill or telephone bill directly as opposed to giving the money to the individual. The beneficiary cannot dictate the trustee to create a distribution, making assets held at a correctly drafted special needs trust inaccessible to the beneficiary’s creditors.
Consequently, before committing money or other assets to a disabled person who you need to check with a lawyer to ascertain the best and most efficient method to enrich that person’s life. It could require establishing a trust to benefit the person during their lifetime or it may simply entail paying the individual’s phone bill directly. Click here to begin.