Estate planning must be done carefully. It is best to seek advice from a professional financial planner who is knowledgeable about the legal issues surrounding the addition of financial assets by an adult with a disability.
If you are left with, given or obtain more than $2,000 you may lose your needs-based government funding. Cash value in life insurance policies is counted separately.
You and your parents should seek a representative for estate planning. You may want to ask about:
Informal Estate Planning
Formal Estate Planning
Planning for Assets of the Disabled Person
The Letter of Intent
Additional Resources
**** Medicaid: An Important Benefit That Should Not Be Overlooked ****
**** Special Needs Trusts - by Diann Jones ****
Securing future for a disabled child
By Sandra Block, USA TODAY
Most parents of special needs children realize their children probably will outlive them, yet nearly a third have not made any plans for their child's financial future, according to a MetLife survey released earlier this year.
And while 60% of parents said their child with special needs will require lifetime care, the majority hadn't even prepared a will, says Nadine Vogel, founder of MetLife's special-needs division.
LETTER OF INTENT
A letter of intent provides guidelines for your caregivers and guardians after your parents are gone. The letter should include your medical history, daily care requirements, and your likes and dislikes. Here are some questions the letter of intent should address: Read the entire article, click here...
Informal Estate Planning
You are left out of the will, with an informal understanding that other family members will fairly share possessions with you. However, there is no legal agreement that requires equal sharing of possessions.
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Formal Estate Planning
Possessions are legally willed. However, possessions valued at more than $2000 would exclude you from eligibility for needs-based government funded support programs, such as Social Security Disability Income or Medical Assistance.
Regular support trust. Again, possessions of more than $2000 can disqualify you from receiving government-funded supports. However, guardianship is legally stated in this form of trust and continual financial support is drawn from the trust’s income or principal or both.
Discretionary Special Needs Trust. The trust gives total power to the trustee to spend or not to spend income or principal. This trust may not allow spending for anything the government already provides, but would allow spending for additional needs not covered by government funded-programs.
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Planning for Assets of the Person with a Disability
Special Needs Trusts
Special Needs Trust Established and Managed by a Non-Profit Association
This is similar to the Discretionary Special Needs Trust, but possessions remaining in an account upon your death are typically repayable to the Commonwealth for MA benefits paid out. Remaining possessions are held by the non-profit to be used for the benefit of others served by the non-profit agency. One such trust is the Ken-Crest Centers Special Needs Trust, which is available to any qualifying person whether served by Ken-Crest or not.
Put use of funds from Special Needs Trusts during the life of the beneficiary.
Typically, funds held in family-funded special needs trusts are to be available for any extra and additional use for which the government does not provide funds.
Travel and entertainment are common uses for discretionary trust payments. However, some beneficial value must be associated with funds used for leisure or recreational purposes. For example, tickets to a sporting event are permitted if they are used in combination with training to improve appropriate social/behavior skills or with training to negotiate public spaces and events.
Estate planning and possession protection for adults with developmental disabilities is complicated. The Commonwealth’s conditions defining trust arrangements continue to change, as do the limits of allowable possessions set forth by government-funded programs.
You and your parents should consult with legal counsel or a professional estate planner to:
• Draw up a will
• Define guardianship
• Develop an estate plan
• Set up an appropriate trust
Information on Estate Planning provided by John A. Rule Esq, Miller, Turetsky, Rule, and McLennan. For more information phone (610) 489-3300 or info@millerturetsky.com.
For more information on Special Needs Trusts and Estate Planning:
The ARC
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The Letter of Intent
~by Wes Cosgriff, Principal, Secured Futures.
Special needs, financial, and estate planning is much more difficult than traditional financial planning. We require the development of a complex plan for your long-term care and guidance. However, once the plan is complete, how do you and your family communicate its needs for your long-term care and support? (Click here to read the entire article).
The Letter Of Intent is a method for you and your parents to communicate wishes, hopes, and desires for your care and supervision into the future. This is especially important for the current generation of school-age kids, as this is one of the first generations in which it may be likely that you will out-live your parents due to continued advances in treatments and medical technology.
A Letter Of Intent can take many forms; from pen and paper to compact discs. However, the form of the Letter Of Intent is not as important as its content and the guidance it provides for future caregivers, custodians, or trustees. Without a Letter Of Intent, your future caregivers may not know what the important issues are in your life, and they may not know what interventions or services have worked best for you in the past.
Sample Topics:
Biographical and Family Information
Medical History and Medications/Current physicians
Important People
List of Advisors
Location of Important Documents
Personality Traits and Preferences
Personal Care Information
Residential/Housing Preferences and history
Important Daily Routines
Additional Information
General Statement of Desires
For more information on the Letter of Intent or Special Needs Estate Planning, contact Wes Cosgriff at Secured Futures, 215-489-7450. This link provides an outline of information that should be included in your Letter of Intent. http://www.cresources.org/
**** Have You Written a Letter of Intent for Your Child with a Disability? ****
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Additional Resources MetDesk
www.metlife.com/desk/
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