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Westlake Legal Group > Posts tagged "Special Needs Planning"

Special Needs Planning: Don’t Leave Your Child’s Future in the Hands of an Unpredictable Congress

Westlake Legal Group special-needs-planning-dont-leave-your-childs-future-in-the-hands-of-an-unpredictable-congress-1 Special Needs Planning: Don’t Leave Your Child’s Future in the Hands of an Unpredictable Congress Special Needs Trusts Information special needs trust Special Needs Planning Medicare/Medicaid Information Fairfax special needs planning attorney   Government programs are meant to provide assistance to our citizens. However, even programs that can mean the difference between life and death, such as Medicaid and Supplemental Security Income (SSI), can have their budgets cut, benefits reduced, qualifications tightened, or they can be eliminated entirely. These programs are basically left to the whims of Congress. That is one of the many reasons I encourage parents of children with special needs to have back up plans, so that there are always funds available to supplement, or replace, any benefits they are currently receiving.

However, your special needs plan must accomplish this goal legally, and in the right way. For example, due to your child’s health issues, Medicaid may be vital.    You know that you need a plan to ensure your child is taken care of when you are no longer around someday.  You attempt to accomplish this goal by setting up a will that leaves your estate to your child with disabilities when you pass away.  While that would indeed help your child financially, it would also backfire by causing the child to become ineligible for Medicaid and the health care benefits that he or she so desperately relies on.  While one problem would be solved by this strategy, a different situation would be made much, much worse.

Fortunately, you do not have to disinherit your child to achieve ALL of your planning goals.  After evaluating your unique situation, a special needs planning attorney may advise you to set up a Special Needs Trust.   Money or assets held in a Special Needs Trust are not technically in your child’s name, and therefore do not could toward eligibility for government benefits.  Using this legal tool, your child could enjoy the funds in the trust, without the fear of losing Medicaid or SSI.

Most parents want their children to have access to more than just the basic needs that are provided by Medicaid and SSI. They deserve recreation, transportation, proper dental care, companionship and much more. Having funds in a Special Needs Trust allows them to have the financial means to pay for these things. Plus, it gives them an added cushion so that if the programs on which your child depends is reduced or cut out completely, they’ll still be alright.

If you would like to talk about setting up a Special Needs Trust as part of a  plan that meets the unique circumstances that your family faces, call the Law Office of Sheri R. Abrams at (571) 328-5795 to set up an appointment. .

Westlake Legal Group special-needs-planning-dont-leave-your-childs-future-in-the-hands-of-an-unpredictable-congress Special Needs Planning: Don’t Leave Your Child’s Future in the Hands of an Unpredictable Congress Special Needs Trusts Information special needs trust Special Needs Planning Medicare/Medicaid Information Fairfax special needs planning attorney

Contact us at: Westlake Legal Group Your Northern Virginia Full Service Law Firm. Call (703) 406-7616 or click here for our website: http://westlakelegal.com/

You Can Now Raise the Amount You Deposit in Your Loved One’s ABLE Account

Westlake Legal Group you-can-now-raise-the-amount-you-deposit-in-your-loved-ones-able-account-1 You Can Now Raise the Amount You Deposit in Your Loved One’s ABLE Account Special Needs Planning special needs information ABLE Act Able Accounts

The Achieving a Better Life Experience (ABLE) Act, which was created by Congress in 2014, allows people with disabilities and their families to save up to $100,000 in accounts for the benefit of a disabled person. The funds can be saved without jeopardizing the individual’s eligibility for Medicaid, Supplemental Security Income (SSI) and other government benefits. ABLE accounts may be opened by anyone with a disability as long as the disability began before the person turned 26.

Starting in 2018, the amount of money that can be deposited in an ABLE account per year without jeopardizing public benefits will rise from $14,000 to $15,000. The amount that can be deposited in an ABLE account is tied to the federal gift tax exclusion, which has also risen to $15,000.

Other changes to the program in 2018 include the following:

  • If you have an ABLE account and you work, you can put up to an extra $12,060 of your earnings into your account (on top of the regular $15,000 that is allowed). The $12,060 must be from your own earnings – it cannot be contributions from others or money you get from benefits or other unearned income.
    • Note: This means that if you earn $12,060 or more, you could have a total of up to $27,060 go into your ABLE account in a year. If you earn less than $12,060, the amount you could contribute would be lower.
  • Money can be rolled over tax-free from a regular 529 college savings plan to an ABLE account. That means that money which hasn’t been or won’t be used for college can instead be used for expenses that are approved for usage from an ABLE account.
  • If you have an account, you have to make sure that too much money isn’t contributed into your account (even if it is other people making the deposits).

Setting up an ABLE account is often a solid way to save money for future expenses for an individual with disabilities. As with most federal or state programs, there are intricacies in the rules that should be understood prior to establishing an account. I encourage you to seek the assistance of a qualified special needs attorney to ensure that you understand the process before tying up your funds.

If you would like to speak to an attorney about the creation of an ABLE Account or to create an ABLE account in conjunction with a Special Needs Trust for your disabled loved one, please contact the Law Office of Sheri R. Abrams at (571) 328-5795 to schedule a consultation.

Westlake Legal Group you-can-now-raise-the-amount-you-deposit-in-your-loved-ones-able-account You Can Now Raise the Amount You Deposit in Your Loved One’s ABLE Account Special Needs Planning special needs information ABLE Act Able Accounts

Contact us at: Westlake Legal Group Your Northern Virginia Full Service Law Firm. Call (703) 406-7616 or click here for our website: http://westlakelegal.com/

The Letter of Intent as a Part of Your Special Needs Planning

Westlake Legal Group the-letter-of-intent-as-a-part-of-your-special-needs-planning-1 The Letter of Intent as a Part of Your Special Needs Planning Special Needs Planning letter of intent Child with Disabilities   The documentation that you create with your Virginia Special Needs Planning lawyer should be quite detailed and will take an incredible amount into consideration, but it will likely not cover every possible concern or wish you may have for your child’s future care.  For that purpose, many parents work with their lawyer to create a Letter of Intent.

The Letter of Intent is more along the lines of a personal letter, rather than being a more formal legal document.  It is used to supplement the Special Needs Trust in order to provide additional information.

Uses for the Letter of Intent

  • Parents often use it to address wishes that they have which don’t really fall under the purview of legal documents.
  • This document is also useful for addressing information about your child that is subject to change. While various other Special Needs Planning documents tend to be more static, the Letter of Intent can be changed out as the information in it needs to be updated.
  • Finally, a Letter of Intent is used to discuss topics that are just too lengthy to include in the Special Needs Trust.

The letter is typically addressed to the people who will be caring for your child once you are unable to fulfill that role.  When the time comes, this Letter of Intent should be given to your child’s caregivers, as well as with the trustee.  They can use the letter to help interpret your desires and to help follow through on the wishes you have for your child.

Sheri R. Abrams, Special Needs Planning Attorney in Fairfax, can help you draw up your Letter of Intent as a supplemental piece to your Special Needs Trust.  Call us at (571) 328-5795 to schedule an appointment.

Westlake Legal Group the-letter-of-intent-as-a-part-of-your-special-needs-planning The Letter of Intent as a Part of Your Special Needs Planning Special Needs Planning letter of intent Child with Disabilities

Contact us at: Westlake Legal Group Your Northern Virginia Full Service Law Firm. Call (703) 406-7616 or click here for our website: http://westlakelegal.com/

Special Needs Trust or ABLE Account? A Virginia Special Needs Planning Attorney Helps You Decide.

Westlake Legal Group special-needs-trust-or-able-account-a-virginia-special-needs-planning-attorney-helps-you-decide-1 Special Needs Trust or ABLE Account? A Virginia Special Needs Planning Attorney Helps You Decide. Virginia special needs planning attorney Special Needs Trusts Information Special Needs Planning special needs   Families with disabled loved ones have had to walk a very fine line for many years. There is often a delicate balance between providing their family member with the most comfortable life possible, while also ensuring that extra assets or income don’t jeopardize their loved one’s eligibility to receive essential government benefits like Medicaid and Supplemental Security Income (SSI).

For years, the most effective way to achieve this balance was to set up a Special Needs Trust.  But, in 2014, the federal Achieving a Better Life Experience (ABLE) Act created Internal Revenue Code Section 529A, which authorizes each State to offer tax-advantaged savings accounts for the disabled.

The plan works similarly to Section 529 college savings plans. The ABLE Act allows family members and others to make cash contributions to a qualified beneficiary’s ABLE account. The annual contribution amount is limited to the federal gift tax annual exclusion amount which is currently will be increasing to $15,000 in 2018.

The account grows tax-free and earnings may be withdrawn tax-free as long as they are used to pay “qualified disability expenses.” Qualified disability expenses include health care, education, housing, transportation, employment training, assistive technology, personal support services, financial management or legal services.

In most cases, an ABLE account won’t affect the beneficiary’s eligibility for Medicaid and SSI. However, distributions from an ABLE account used to pay housing expenses are countable assets. Also, if the balance of the ABLE account grows beyond $100,000, eligibility for SSI is suspended until the balance is brought below that threshold.

At this point, you may be wondering which would be better for your situation…or perhaps if you need BOTH tools to get the most out of your special needs plan. It’s really best to seek the advice of a qualified Special Needs Lawyer to discuss your unique circumstances. But, here’s a quick comparison to help guide you.

Availability

ABLE accounts are available only if your home state offers them or contracts with another state to make them available. Luckily, Virginia does offer them. In fact, Virginia was the first state to offer ABLE Accounts in 2015.

Age Restrictions

As previously stated, ABLE account beneficiaries must have become disabled before age 26. There are no age restrictions for Third Party Special Needs Trusts.

Qualified Expenses

ABLE accounts can be used to pay only specific types of expenses. Special Needs Trusts may be used to pay for “quality of life” expenses such as travel, recreation, entertainment and hobbies.

Taxes

An ABLE account’s earnings and qualified distributions are tax-free.  A Special Needs Trust’s earnings are taxable.

There are many other considerations to examine that may impact your choice, so it is best to work with an experienced Special Needs Trust Lawyer who can help guide you based on you and your loved one’s unique circumstances. If you’d like assistance getting started, we invite you to contact the Law Office of Sheri R. Abrams at (571) 328-5795 to schedule an appointment.

Westlake Legal Group special-needs-trust-or-able-account-a-virginia-special-needs-planning-attorney-helps-you-decide Special Needs Trust or ABLE Account? A Virginia Special Needs Planning Attorney Helps You Decide. Virginia special needs planning attorney Special Needs Trusts Information Special Needs Planning special needs

Contact us at: Westlake Legal Group Your Northern Virginia Full Service Law Firm. Call (703) 406-7616 or click here for our website: http://westlakelegal.com/

Should I Disinherit My Child with Special Needs and Leave the Money to Siblings Instead?

Westlake Legal Group should-i-disinherit-my-child-with-special-needs-and-leave-the-money-to-siblings-instead-1 Should I Disinherit My Child with Special Needs and Leave the Money to Siblings Instead? Special Needs Planning Fairfax special needs planning attorney child with special needs Child with Disabilities   For many children with special needs, access to government programs is critical to their overall well-being. However, programs like Medicaid and Supplemental Security Income (SSI) are needs-based, and any money given to a child with disabilities could cause them to become ineligible for the benefits he or she depends on.

This presents an issue for parents who want to leave an inheritance to their child with disabilities when they die.  How can they make sure to leave behind enough money and assets to pay for their child’s care, without jeopardizing access to healthcare or other critical public services?

Some parents have been told that the only way to accomplish this goal is to disinherit the child with special needs when they die and instead pass all assets to siblings with the understanding that they will “help” their brother or sister down the road. This is usually not a good idea.

Entrusting a sibling to hold assets for the benefit of a child with special needs could jeopardize the assets all together.  If the sibling gets divorced, gets into an accident, goes bankrupt or is sued, all the money that you expected to be left for the care of your child could be lost. There is also a risk that that the sibling could use the assets for themselves, as nothing could legally stop them from doing so.

No one wants to believe these things would happen, but when it comes to protecting the future of your child with special needs, you simply can’t leave their well-being to chance.

Rather than disinheriting a child with special needs, we recommend that a Special Needs Trust be established for his or her benefit. Transfers to a Special Needs Trust typically will not create any period of ineligibility or cause the child to lose benefits. The assets in a Special Needs Trust can then be used to supplement, not replace, monies available through government assistance, as the inheritance will not be left in the child’s name.

Plus, using a Special Needs Trust guarantees that the funds will be held only for the benefit of the child with special needs and not for other individuals or other purposes, while ensuring that eligibility for government programs is not compromised.

If you would like to learn more about protecting your child’s financial future using a Special Needs Trust, call the Law Office of Sheri R. Abrams at (571) 328-5795 to schedule an appointment.

Westlake Legal Group should-i-disinherit-my-child-with-special-needs-and-leave-the-money-to-siblings-instead Should I Disinherit My Child with Special Needs and Leave the Money to Siblings Instead? Special Needs Planning Fairfax special needs planning attorney child with special needs Child with Disabilities

Contact us at: Westlake Legal Group Your Northern Virginia Full Service Law Firm. Call (703) 406-7616 or click here for our website: http://westlakelegal.com/

Fairfax Special Needs Planning Lawyer: Be Careful When Fundraising for a Person with Disabilities

Westlake Legal Group fairfax-special-needs-planning-lawyer-be-careful-when-fundraising-for-a-person-with-disabilities-1 Fairfax Special Needs Planning Lawyer: Be Careful When Fundraising for a Person with Disabilities Special Needs Planning Fairfax Virginia Special Needs Planning Attorney   With the creation of easy-access fundraising tools like “GoFundMe,” more and more people are inadvertently causing problems for the disabled person they are trying to help. Raising money for someone who depends on government programs like Medicaid or Supplemental Security Income (SSI) could cause the disabled person to go beyond income thresholds and jeopardize their access to services that they need.

Before collecting money for a disabled loved one, make sure that a proper Special Needs Trust has been established so that assets are not given directly to the person with special needs. Putting money into the Special Needs Trust will benefit the person, but will not disqualify him or her from government benefits.

It is important to note that donations are typically not tax deductible for the donor because the money is only being used for a particular person or family. Be sure to let potential donors know this in advance by explaining that the money donated will be treated as a gift to the Special Needs Trust.

As you can see, gathering donations for a person with special needs must be handled carefully. Be sure to do your homework and talk to an experienced Fairfax Virginia Special Needs Planning Attorney before you begin.  If you would like help getting started, give the Law Office of Sheri R. Abrams a call at (571) 328-5795 to schedule an appointment.

Westlake Legal Group fairfax-special-needs-planning-lawyer-be-careful-when-fundraising-for-a-person-with-disabilities Fairfax Special Needs Planning Lawyer: Be Careful When Fundraising for a Person with Disabilities Special Needs Planning Fairfax Virginia Special Needs Planning Attorney

Contact us at: Westlake Legal Group Your Northern Virginia Full Service Law Firm. Call (703) 406-7616 or click here for our website: http://westlakelegal.com/

Fairfax Virginia Special Needs Planning Lawyer: Name a Guardian, and Back-Up Guardians, Who Can Help Your Child with Disabilities After Age 18

Westlake Legal Group fairfax-virginia-special-needs-planning-lawyer-name-a-guardian-and-back-up-guardians-who-can-help-your-child-with-disabilities-after-age-18-1 Fairfax Virginia Special Needs Planning Lawyer: Name a Guardian, and Back-Up Guardians, Who Can Help Your Child with Disabilities After Age 18 Special Needs Planning guardians   As you probably know as a reader of my blog, I actively promote naming guardians for your children. It is critical to be sure that someone is on standby to raise your child if the unexpected happens. The more you plan, the better your chances are that your child will continue to thrive even if you cannot be there. For parents of children who have special needs, the need for a guardian often goes well beyond the age when the child is legally an adult in the eyes of the law. As a Fairfax Virginia special needs planning lawyer, I have seen this over and over.

At Age 18, Your Child with Disabilities Will Assume the Rights and Responsibilities of Legal Adults

Many parents assume that because their child is disabled, they will still be able to make decisions and retain control of the child’s care once he or she turns 18.  Not true.  Once your child turns 18, he or she is an adult in the eyes of the law, regardless of his or her disabilities or special needs.  The only way for mom or dad to continue to have a say is through a process known as guardianship. This is awarded by the courts and will allow the parents to continue to manage their child’s decisions for them as they have done for their entire life.

Wait—What Happens If the Guardian Passes Away?

This is a commonly overlooked issue among parents of children with special needs. Parents should also take the time to name a successor guardian for their child. This will allow someone to immediately step in if something should happen to the primary guardian. Alternatively, they can appoint a co-guardian to serve simultaneously, in which case the surviving guardian will continue to serve as sole guardian upon the death of one of them.

If your special child needs additional help with decision making due to a disability, you should develop a plan immediately. It is best to work with a special needs planning attorney who has experience with the rules and laws associated with your unique circumstances. If you would like help getting started, give the law office of Sheri R. Abrams a call at (571) 328-5795 to schedule an appointment.

Westlake Legal Group fairfax-virginia-special-needs-planning-lawyer-name-a-guardian-and-back-up-guardians-who-can-help-your-child-with-disabilities-after-age-18 Fairfax Virginia Special Needs Planning Lawyer: Name a Guardian, and Back-Up Guardians, Who Can Help Your Child with Disabilities After Age 18 Special Needs Planning guardians

Contact us at: Westlake Legal Group Your Northern Virginia Full Service Law Firm. Call (703) 406-7616 or click here for our website: http://westlakelegal.com/

Should I Use a Professional Trustee for my Child’s Special Needs Trust in Virginia?

Westlake Legal Group should-i-use-a-professional-trustee-for-my-childs-special-needs-trust-in-virginia-1 Should I Use a Professional Trustee for my Child’s Special Needs Trust in Virginia? Special Needs Trusts Information special needs trust Special Needs Planning   In most cases, parents or family members of a person with special needs serve as trustees of the child’s Special Needs Trust in Virginia. However, in some cases, the parents may choose not to serve as trustee and will ask other family members or close friends to serve instead. However, it’s not unusual for the trustee to become overwhelmed with the responsibility. Not only are there bills to be paid and tax returns needed, but there are also requirements for financial statements that need to be prepared and sent to various government agencies. It’s a LOT of paperwork.

If this happens and you are afraid that your child’s trustee is not up for the job, it may be time to consider the services of a professional trustee. Remember, if your current trustee is running into trouble, he or she may be hesitant to tell you because they don’t want to “burden” you or let you down. That is why I recommend to my clients that they proactively monitor the trustee and watch for these warning signs.

  1. Things are not getting done on a timely basis.

Every Special Needs Trust is unique, but in most cases, serving as the trustee of a Special Needs Trust can seem like a full-time job. The trustee could be spending a great deal of time monitoring government benefits, paying bills and serving as a liaison between the beneficiary and various service providers. If the trustee is not able to perform these tasks in a timely manner, it may be time to look for a professional trustee.

  1. They have trouble keeping track of government benefit rules.

One of the primary reasons for establishing a Special Needs Trust is to maintain the beneficiary’s eligibility for essential government programs like Supplemental Security Income (SSI) and Medicaid. It is critical that the trustee understand the complicated, and sometimes contradictory, rules governing the programs and the Special Needs Trust. If you suspect that your chosen trustee is having trouble, it may be time to seek the services of a professional trustee who is experienced with the rules and can make solid decisions.

  1. The beneficiary is high-maintenance.

If the beneficiary of the Special Needs Trust is aware of the trust and capable of interacting with the trustee, they can sometimes make the trustee’s life difficult. In some cases, the beneficiary feels entitled to the money in the trust and puts pressure on the trustee to distribute it in ways that are not appropriate. This is particularly troublesome when the trust is managed by a family member. I’ve seen many family squabbles that would have been avoided if a professional trustee was involved.

If you are seeing any of these signs, you should immediately seek the help of an experienced special needs planning lawyer. You can work with them to bring in support from a professional. You can either turn over the entire responsibility of trust administration to a professional trustee, or remain as the trustee yourself and have the support you need from the professional. No matter how you decide to handle the situation, the sooner you put safeguards in place, the more secure the beneficiary will be.

Westlake Legal Group should-i-use-a-professional-trustee-for-my-childs-special-needs-trust-in-virginia Should I Use a Professional Trustee for my Child’s Special Needs Trust in Virginia? Special Needs Trusts Information special needs trust Special Needs Planning

Contact us at: Westlake Legal Group Your Northern Virginia Full Service Law Firm. Call (703) 406-7616 or click here for our website: http://westlakelegal.com/

Virginia Special Needs Planning Lawyer: Options for Funding a Special Needs Trust

Westlake Legal Group virginia-special-needs-planning-lawyer-options-for-funding-a-special-needs-trust-1 Virginia Special Needs Planning Lawyer: Options for Funding a Special Needs Trust Virginia special needs planning lawyer special needs trust Special Needs Planning   As a Virginia special needs planning lawyer, I’ve spoken to hundreds of parents who have children with special needs and one common concern that they share is making sure their child has access to the money they need to remain comfortable and secure for the rest of their life. The good news is that it isn’t necessary to be rich to accomplish this. You can set up a special needs trust using funds you may not have considered.

But, before jumping into the source of funds that you may use, you need to remember this one very important thing:

The Special Needs Trust, NOT your child, must be the beneficiary of any funds that you, or anyone else, wants to transfer to your child.

Always keep in mind that there are limits to how much money (in cash or property) that are not in a Special Needs Trust that your child can have before becoming ineligible for receiving government benefits.

Finding the Funds for Special Needs Trust

In addition to a family’s savings, there are other sources that you can use to fund your child’s Special Needs Trust.

Insurance – There are actually a few scenarios to consider here.

  • Term Life Insurance – This type of policy is a relatively inexpensive path to funding a Special Needs Trust because they only guarantee a payout during a defined period of time. Most of the time, term policies can be renewed upon expiration unless there are changes in the owner’s medical condition or upon their reaching a certain age.
  • Whole Life Insurance – This type of policy covers the entire life span of the policy owner and part of the premium is collected in an investment account that grows in value. Whole life is often more expensive than term.
  • Variable Life Insurance – This type of policy also provides lifelong coverage, but the cash value fluctuates along with financial markets.
  • Second to Die Life Insurance – This type of policy pays out only after the second member of the supporting couple (most often the parents) passes away. It is generally cheaper than other type of life insurance.  Proceed with caution with this type of policy however, because funds may be needed after the first parent passes if they were the primary breadwinner or were full-time caregiver of the child.

Real Estate – The family residence may be the only home that the child with special needs has ever known. In that case, parents want to preserve that stability for the child after they pass. But, leaving a home in the child’s name could be a big mistake. In addition to possibly making the child ineligible for government programs, you would also be adding the heavy burden of home ownership on your child or their guardian.

Retirement Plans – Designating a Special Need Trust as the beneficiary of a retirement plan is a good idea, but it should be managed carefully. If not done properly, all the funds could be distributed to the child and taxed during the year of transfer. This could disqualify the child for government benefits and result in unnecessarily high taxes.

Deciding how to fund a Special Needs Trust is complicated. That is why it is critical to consult with an experienced special needs planning lawyer in Virginia who understands disability benefits law.  Protecting your child’s eligibility for government benefits while setting aside money to supplement those benefits can make all the difference for their financial security.

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Contact us at: Westlake Legal Group Your Northern Virginia Full Service Law Firm. Call (703) 406-7616 or click here for our website: http://westlakelegal.com/