It's important for everyone to have a plan in life and in death, and individuals with a disability are no different. Did you know that physical and mental disabilities are two of the most overlooked reasons for creating an estate plan?
Well, they shouldn't be!
It's very important for those with disabilities to have a plan. Without a plan who knows what could happen. At any age or time in life anyone could become disabled. Whether the disability is physical or mental it could cause you to be unable to control your own estate.
This is why it is so important to plan ahead. And for those currently living with disabilities it's important to have a plan in place to make sure your needs are met, and your estate is taken care of properly.
There are two major situations in which disability planning is very important. One such situation is if you have a child who is physically or mentally disabled and unable to care for themselves. The other is elderly people with physical or mental disabilities with declining health who may lose the ability to make informed decisions for themselves and the ability to control their estate.
If you are caring for a child with a disability, and they depend solely on you, what happens when you can no longer care for them or you are no longer here? You need to have a plan in order to make sure that they are properly cared for. If you are elderly and concerned about your health situation, or if you have an elderly parent and are concerned for their health, you need to consider what would happen if you or they could no longer make decisions for themselves. Who would make their decisions for them?
So, what potentially happens if you don't have a plan?
If there is no legal documents concerning you or your estate, and you are unable to make decisions for yourself, or if something happens to you and there is no plan made concerning your disabled dependent, then there will be a court proceeding to establish authority for an individual to act on behalf of another called Guardianship/Conservatorship. In essence the courts will appoint a Guardian and a Conservator to act on your or your dependents, behalf.
The problem with Guardianship/Conservatorship is that it is very expensive and time consuming. There are attorney's fees, accounting fees, probate fees, record-keeping requirements, regular court reporting, and court overview hearings! The good news is we can help you avoid the waste of time and money on Guardianship/Conservatorship!
We can help you make a plan for the future. We do this through the use of a Durable Power of Attorney, a Health Care Directive, and Living Trust Planning.
If you have a loved one with special needs receiving government benefits, there are specific rules that have to be followed to provide for them after you are gone and yet allow them to maintain those benefits. Establishing a Supplemental Needs Trust for your loved one will ensure that they will always be cared for, but not at the expense of losing their government benefits. A Supplemental Needs Trust appoints someone as the Trustee over any assets that you leave for the benefit of your special needs loved one, and the Trust instructs your Trustee as to how you want your loved one to be provided for. Supplemental Needs Trust funds are commonly used to pay for vacations, home furnishings, out-of-pocket medical and dental expenses, education, recreation, and vehicles. The Supplemental Needs Trust can provide peace of mind, knowing that you will be providing for your loved one even when you are gone.
You should avoid transferring assets directly to your disabled loved one, as this may disqualify him or her from receiving government benefits. An inheritance from another family member can have the same effect. Pluto Legal can help you form a Supplemental Needs Trust to provide for the future needs of your loved one.
If you are disabled and the recipient of government benefits, such as Medical Assistance or Supplemental Security Income, and you have recently received a large sum of money through an inheritance or lawsuit settlement, a Special Needs Trust will allow you to retain the funds and your government benefits. A Special Needs Trust holds the assets that would otherwise disqualify a disabled individual from receiving government benefits subject to an asset limit test, and appoints a Trustee to distribute those assets to the disabled individual for specific purposes that are not already being paid for by government benefits. Similar to the Supplemental Needs Trust, the Special Needs Trust funds may be used to pay for vacations, home furnishings, out-of-pocket medical and dental expenses, education, recreation, and vehicles. Pluto Legal can help you determine whether you meet the qualifications for a Special Needs Trust, and can guide you through the process of establishing a Trust to protect your benefits.