A special needs trust is essential for protecting a loved ones quality of life and access to government benefits.
When drafting a special needs trust for your disabled child or other special needs family member, you want to make sure that there are no mistakes that could jeopardize their financial future and care.
But too often, mistakes are made and can go undetected until it is too late. When creating special needs trusts in Doylestown, beware of these common mistakes.
For centuries, trusts have allowed parents to set aside money for that their children could access when they got older.
But for some parents, it’s not that simple. If you have a child or other loved one with special needs, you might worry about how they can support themselves after you’ve gone.
That’s where a special needs trust comes into play. This is a trust set up to help a disabled person who receives government benefits such as Medicaid or Social Security. It is administered by a trustee, who can be a relative, friend, or someone you designate to handle the trust.
It’s no surprise that having a special needs child is both challenging and rewarding. Not only are there school and medical issues to consider, there are also the financial needs of your child. Planning for your child’s financial well-being should be an important part of your estate plan especially since improved healthcare has allowed children with conditions such as cerebral palsy and Down’s Syndrome, to live longer.
There is new legislation that allows for a family that has a loved one with special needs to set up an ABLE Savings Account. The Stephen J. Beck, Jr. Achieving a Better Life Experience Act (ABLE Act) was signed into law in December 2014. This law allows states to create their own ABLE programs. Previously, Special Needs Trusts were the only way a family could save money for a special needs individual without losing eligibility for SSI and Medicaid benefits. But now with the availability of ABLE Savings accounts, families have another option to save for their disabled loved one’s future.
Supplemental needs trusts in PA serve a specific and important purpose: to provide for someone with a physical or mental disability after the death of a parent or another loved one.
Here are some common questions we hear about these trusts:
1. Who can create supplemental needs trusts in PA?
These trusts – which are also referred to as special needs trusts –are typically set up by a parent, grandparent or legal guardian, although siblings or other relatives can establish a trust as well. In some cases, a judge can create an SNT for a person with a disability.
No one likes to think about the end of their life, but planning for the end is important.
It’s doubly important when you know you’ll be leaving behind children, whether that means juveniles or adult children or other family members with special needs.
Making arrangements for the care of minor children is its own topic. Today we’re going to focus on children with special needs, and the concept of the special needs trust, also known as a supplemental needs trust.
A special needs trust is essential for protecting a loved one’s quality of life and access to government benefits.
Estate planning is nothing new. People know about the importance of having an up to date will, living will and power of attorney and most have these documents at the ready. What if you have a child with a severe physical or mental disability and he or she will not be able to support him or herself? How can you plan for your child’s care when you are no longer around? That’s where special needs planning comes in.
Before consulting with an expert (this is not a do-it-yourself project) you need to organize your and your child’s financial and medical information. Like many people, you probably have social security numbers, phone numbers, etc. in various places. That is why it is important to have this information in an easy to access place. Click here to see what information needs to be gathered and documented.
Many parents of children with special needs ask themselves: Who will care for my child once I am no longer able to? Where will he or she live? Where will financial support come from? Who will advocate for my child? What will happen when he or she reaches adulthood?
These are common questions, which all should be asked in preparation for when parents can no longer care for their child due to advancing age or death. By planning for your child’s future now, you can establish parameters for the level of care needed in the future and prepare your family for their roles and responsibilities in your child’s future.
Begin Planning Early
A small amount of planning now in preparation for a child’s care as an adult can help parents avoid a crisis in the future. To begin special needs planning, parents should consider meeting with an elder law attorney to having the following documents drawn up: a durable financial power of attorney, a medical power of attorney, a letter of intent, physician’s directive or living will and, if appropriate, a declaration of guardianship. These documents will facilitate the care of your adult special needs child, and will help ensure that he or she will be eligible for public benefits.
A health care power of attorney is an essential part of your estate plan.
When planning for the future of an elderly family member or child with special needs, you should consider preparing a powers of attorney. Powers of attorney are a simple and inexpensive way to help manage financial and medical accounts if you or your loved one is no longer able to make decisions clearly. For reasons of simplicity and clarity, it is usually better to have separate financial and medical powers of attorney.
Powers of attorney eliminates the worry and stress of managing financial and medical accounts during a time of incapacitation. Powers of attorney are prepared by your attorney and give control over financial and medical accounts to an agent, who is normally a family member or trusted friend. The agent is then granted legal authority to manage the principal’s accounts, usually while he or she is unable to.
The care of your child with special needs is extremely important now, but it is equally important in the future. Deciding how to care for your child with special needs after your death or if you become incapacitated is vital. Here are 5 costly mistakes to take into consideration when deciding how to provide the best care for your child in the future.
Mistake #1: Disinheritance.
Do not rely on government supported care programs like SSI or Medicaid. Although these programs provide some benefits, they provide little more than the essentials to survive. These programs also do not guarantee that your child will be looked after once you are gone or if you become incapacitated. A more trustworthy and viable option is establishing a Special Needs Trust. A trust will provide a strong foundation for your child and guarantees that he or she is cared for. Continue Reading Planning for the Future of a Child with Special Needs Five Mistakes that can Cost you →