I was pleased to be included in a recent article in Newsday about Special Needs families and how they can use Special Needs Trusts to plan for the time when their adult children are grown and their parents have passed away. A few points to expand upon:
The law in the area of Special Needs and Elder Law is complex and always changing. I have been practicing in this area for decades, and there are always new issues to be addressed.
When a Special Needs Child turns 18, they become an adult. Parents who wish to continue to help their children will need to apply to become their legal guardian.
Someone needs to be named to make medical decisions for a special needs adult when the parents have passed away. It is far better for the parents to name a guardian well in advance then to wait until the parents have passed and the court is left to appoint a guardian.
Means-tested government programs can be lost if someone names the recipient as a beneficiary. Well-meaning relatives need to be educated so they don’t make this common mistake. The guardian for a special needs individual needs to know to refuse any inheritance, insurance proceeds, etc.
There are two types of Special Needs Trusts:
- Third-Party Special Needs Trusts, which are created using the assets of the parents as part of an estate plan and distributed by a Will or a Living Trust;
- Self-Settled Special Needs Trust, usually created by a parent, grandparent or legal guardian using the child’s assets to fund the Trust. If the assets remain in the trust after the child’s death, a payback to the state is required, but only to the extent that the child receives public assistance benefits.
If your family includes a Special Needs member and you’re not sure how to proceed with planning for their life-long care, please contact the office at 516-307-1236 to make an appointment.