Presented By Donald D. Vanarelli, Esq. Certified Elder Law Attorney Charter Member, Academy of Special Needs Planners 2007-2008 NJ “Super Lawyer” . Planning for a Loved One With Special Needs. What Does Planning Involve? . Preserving your child’s financial security and quality of life
Preserving your child’s financial security and quality of life
Addressing key issues:
Understanding the role of public benefits
Making decisions about the future
Using estate planning/trusts to protect assets
Supplemental Security Income (SSI)
Social Security (SS)
Social Security Disability Insurance (SSDI)
Must meet SSA’s definition of “disability” and have limited assets/income
Provides monthly income for food/shelter
Gateway to Medicaid / in-home support services
Social Security for individuals:
Disabled before age 22 and
With parents eligible based on their work record who are retired, disabled or deceased
SSDI for individuals with work record
Social Security benefits may reduce or eliminate SSI benefits
SSI recipients receive automatically
Covers “medically necessary” services, equipment, hospitalization
In-home services needed to live at home: personal care, housekeeping, cooking, transportation to doctors
Medical coverage, including doctors, hospital, skilled care
18-year-old with autism
Lives with mom
Income from work programs, SSI, Social Security (from dad who is deceased)
Limited personal assets (clothing, tv)
Qualifies for Medicaid
Who will make health care decisions?
Who will make financial decisions?
Where will he live?
How will his medical expenses be paid?
Make no decisions/plans
Leave money to Nathan
Leave money to a future caregiver
Establish third-party SNT for Nathan
Establish first-party SNT for Nathan
Planning ahead makes a difference:
Where and with whom will your child live?
What type/level of care will be required?
Will a guardian/conservator be necessary?
Who else will be involved?
What kind of lifestyle is desired?
What unforeseen challenges could arise?
Details preferences, needs, wishes, both medical and personal
Lists key people in child’s life
What Steps Should You Take Today? Step 2: Create a Memorandum of Intent
SSI, SSDI, Social Security, earned/unearned income
Monthly living expenses:
Housing, food, transportation, medical, recreation, etc.
Consider how any shortfall will be met
What Steps Should You Take Today? Step 3: Estimate Income & Expenses
Income - Expenses = Shortfall
May be established by parents:
Through living trust
“Living” SNT lets others contribute
Trustee has discretion over distributions
What Steps Should You Take Today? Step 4: Utilize a Third-Party SNT
What are the trustee’s responsibilities?
Files tax returns
Hires advocates and care managers, etc., as needed
Who should be the trustee?
Parent with professional co-trustee
Corporate or other professional trustee
Create Memorandum of Intent
Calculate future financial need
Establish SNT through will or living trust
Fund SNT with life insurance
Name SNT as beneficiary of accounts, plans, etc.
Reduce taxable estate
Sign Advance Directives, if legal capacity
Have a legal guardian appointed:
When child without mental capacity becomes an adult and parents want to maintain legal responsibility
Court appoints legal guardian
Establish a First-Party SNT:
Provides funds for living expenses not covered by other income sources
Maintains eligibility for public benefits
Must be established by parent, grandparent, legal guardian or the court
State must be reimbursed from the trust for all Medicaid expenses
Donald D. Vanarelli, Esq. Certified Elder Law Attorney
Charter Member, Academy of Special Needs Planners
2007-2008 NJ “Super Lawyer”