Concerned About Your Disabled Loved One?
When you are gone, you will want your loved ones to be protected. When caring for a disabled loved one, it is natural to wonder how he or she would survive without supervision. By establishing legal guardianship or creating a special needs trust, you are protecting their future.
What Are Reasons for Becoming a Legal Guardian or Conservator?
Sometimes, a disabled person is well enough to make decisions and execute documents. Other times, a legal guardian is needed to make important decisions on his or her behalf. A special needs planning attorney can help you decide whether or not your loved one needs a legal guardian. If you decide to become a legal guardian (a person who makes health care decisions) or conservator (a person who makes financial decisions), then we will walk you through the entire process. There are several reasons for becoming a legal guardian or conservator. They include:
Peace of mind.
Becoming a legal guardian or conservator lets family members know that a responsible party is making decisions. A special needs person may not have the capacity to consistently make smart choices. By taking control of the decision-making process, you are helping protect your loved one’s future.
Providing clear legal authority.
By setting up a conservatorship or guardianship, you will become the legal authority for your loved one. This will come in handy when dealing with third parties who could potentially take advantage of the situation. Under your watch, the likelihood of your loved one being financially or physically abused is significantly lessened.
Setting up a process for approving major decisions.
Before becoming a legal guardian or conservator, you must have a court hearing in front of a judge. You must also appear before a judge before making certain major decisions. If the judge approves your decision, then you can take action on behalf of your loved one.
Can Special Needs Trust Planning Help A Disabled Person Keep Government Benefits?
Creating a special needs trust is a great way to protect your disabled loved one. There are income and asset limits for a number of public benefits, most notably Social Security Supplemental Security Income (SSI). Moreover, a disabled person that qualifies for SSI will normally automatically qualify for Medicaid (administered by MassHealth) healthcare benefits. Without proper trust planning, assets left to a disabled loved one at death can result in the disabled person losing SSI, Medicaid, and other government benefits. Considering the value of these government benefits, the assets left to a disabled loved one often pale in comparison. Thus, a well-meaning but uninformed parent of a disabled child can significantly harm that child without proper planning.
The good news is that with proper planning, you will no longer have to worry about protecting your disabled loved one. We will answer your most difficult questions and can take you through the ins and outs of different planning strategies. These strategies often include the use of third-party special needs trusts, first-party special needs trusts, ABLE accounts, and letters of intent. These strategies can insure that your disabled loved one maintains the highest standard of living possible, as well as their dignity and personal autonomy.
Special Needs FAQs
A Special Needs Trust, or a “D4A” Trust, is a trust funded with the disabled beneficiary’s own assets. The trust may be nominally funded and it must be established before the beneficiary reaches the age of 65. A major benefit of these trusts is that, aside from the management of assets for the beneficiary, if the beneficiary receives any gifts, bequests, or settlement proceeds from a lawsuit, the funds can be placed into the trust without disqualifying the beneficiary from receiving public benefits.
Unlike a Special Needs/D4A Trust, a Supplemental Needs Trust is funded with the assets of a third party, typically a parent. A major benefit of this type of trust over a D4A trust is that that the state does not require that the remainder of the trust assets go toward reimbursing the state for benefits paid after the beneficiary’s death.
A letter of intent is a letter directed to the trustee of a trust benefiting a disabled child. It is typically prepared by a parent with the help of an attorney and provides a highly detailed account of the child’s medical, behavioral, educational, social, and personal needs and preferences.
The Achieving a Better Life Experience Act allows individuals whose disability occurred prior to age 26 to place up to $17,000 per year into a special savings account. There is no limitation on the number of individuals who can contribute to the account, but the disabled beneficiary may have only one account. Funds in an ABLE account will not be counted in determining the disabled person’s eligibility for Supplemental Security Income (SSI) unless the account exceeds $100,000. Upon the death of an ABLE account holder, Medicaid may require reimbursement from the account for services provided after the disabled individual established the account.
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