Financial Help for Parents of Children With Special Needs

/in , /by

Little girl with Down syndrome smiling widely in a sunflower field.If you are planning to be a parent or are thinking of having more children, the scenario of having a child with a disability has probably crossed your mind. Disabilities can form before birth or after birth as a result of accidents or illnesses. According to the U.S. Census Bureau, there were over 3 million children with disabilities in the U.S. in 2019. That translates to 4.3 percent of the under-18 population.

Parents of children with disabilities often face extra financial challenges, including the need for specialized medical care, therapy, and educational support. Understanding the available government benefits and private insurance options is crucial in ensuring that their children receive the necessary care without undue financial burden.

Government Programs

Various state and federal programs offer financial help for families with children with disabilities:

  • Medicaid: Medicaid is a federal and state program that provides health coverage to low-income families, including those with children who have disabilities. Medicaid offers a broad range of services, including long-term care, home health services, and various therapies.
  • Children’s Health Insurance Program: The Children’s Health Insurance Program (CHIP) provides health coverage to children in families with incomes too high to qualify for Medicaid but too low to afford private insurance. CHIP benefits often mirror those of Medicaid and include essential services for children with disabilities.
  • Supplemental Security Income: Supplemental Security Income (SSI) is a federal needs-based program that provides monthly payments to children with disabilities from low-income families. In assessing whether a child is eligible, the Social Security Administration will consider the child’s disability and family income. These funds can go toward medical expenses, educational needs, and other essential supports.
  • Social Security Disability Insurance: Social Security Disability Insurance (SSDI) is another federal assistance program that primarily benefits disabled adults who have worked and paid into the Social Security system. Children with disabilities can also receive SSDI benefits if they have a parent who is disabled, retired, or deceased.
  • Individualized Education Program: Under the Individuals with Disabilities Education Act (IDEA), public schools must provide free and appropriate education to students with disabilities. This may include developing an Individualized Education Program (IEP) tailored to each child’s unique needs, ensuring access to necessary educational resources and support services
  • State-Specific Programs: Many states offer additional programs and benefits for families with children who have disabilities, including respite care, financial assistance, and specialized health services. These programs vary widely, so it is necessary for parents to research and connect with local agencies to understand the full range of available resources. A qualified special needs planner in your area can assist you in locating these services.

Private Insurers

For families who don’t qualify for government assistance, they may be able to get help through their employers’ benefits programs.

  • Employer-Sponsored Insurance: Many parents rely on employer-sponsored health insurance plans. These often include coverage for various medical services, therapies, and sometimes even specialized equipment for children with disabilities.
  • Individual Health Insurance Plans: For those who do not have access to employer-sponsored insurance, individual health insurance plans purchased through the Health Insurance Marketplace can be a viable option. These plans must cover essential health benefits, which include services particularly important for children with disabilities, such as prescription drugs, mental health services, and rehabilitative services.
  • Disability Insurance: Though primarily designed for adults, some disability insurance plans can offer benefits that indirectly support families. For example, these plans may be able to replace lost income when a parent needs to take time off to care for a child with a disability.
  • Long-Term Care Insurance: This type of insurance can provide additional support for children with severe disabilities who require long-term care. Long-term care insurance covers services that might not be part of standard health insurance plans.
  • Juno Insurance Services, LLC: Juno Insurance Services is one company that offers tailored insurance solutions for families with children with disabilities. They provide a range of products designed to cover specific needs, such as therapies, special education, and assistive devices. Juno stands out by offering personalized plans that address the unique circumstances of each family, ensuring comprehensive coverage and financial support.

Learn More About Getting Help With the Costs of Caring for a Child With Disabilities

Whether you have a child with a disability or want to be prepared in the event you have a child with a disability, there are resources available to you. Contact a special needs planning attorney Add Goff today to discuss your specific situation, options, and rights. A special needs planner can also assist you in exploring various estate planning tools that you can put into place to secure your child’s future well-being and financial security.

Avoid Scams When Applying for Government Benefits

/in , /by

Close up of girl looking at military dog tag that veteran father is wearing.In recent years, the number of for-profit companies preying on people with disabilities and veterans applying for state and federal government benefits has surged. These entities exploit the complexities of the benefits system, often leaving the most vulnerable members of society at a significant disadvantage. Learn about some of the various tactics these companies use, the legal and ethical implications of their practices, and the urgent need for reform and regulation to protect those who have served and those who are most in need.

Government Benefits for Veterans and People With Disabilities

Government benefits for veterans and disabled individuals provide financial assistance, health care, and support services. Programs such as Social Security Disability Insurance (SSDI), Supplemental Security Income (SSI), and Veterans Affairs (VA) benefits are among the crucial programs providing a lifeline for millions. They seek to aid those who are unable to work because of physical or mental disabilities.

However, the process of applying for these benefits can be complex, bureaucratic, and time-consuming. Many applicants face long waits, extensive paperwork, and frequent denials, making the system difficult to navigate without professional help. This complexity creates a fertile ground for exploitation by for-profit companies that promise to streamline the application process — for a fee.

For-Profit Companies Preying on the Needy

For-profit companies have identified a lucrative market in assisting disabled individuals and veterans with their benefits applications. These companies claim they can expedite the application process, increase the chances of approval, or secure higher benefits. Some provide legitimate services. Others employ predatory practices that take advantage of vulnerable applicants and their lack of knowledge.

According to The Washington Post, the number of these for-profit companies has grown since the inception of the Honoring our Pact Act in 2022. Some of these companies prey on veterans even while being run by veterans.

Common Exploitative Practices

Companies seeking to profit from others’ needs employ different tactics. Here are some ways they take advantage of those who are vulnerable.

Exorbitant Fees and Charges

Companies often charge high upfront fees or a percentage of the benefits awarded. For example, some companies charge a contingency fee of 20 percent to 25 percent of the first retroactive benefit payment, which can amount to thousands of dollars. This practice is particularly harmful to veterans, who may be awarded significant back pay after years of waiting for benefits.

Misleading Advertising

These companies frequently use misleading marketing tactics to convince applicants that their services are necessary. They may falsely imply a direct relationship with government agencies or claim that their services guarantee benefit approval. Such practices create false hope and can lead applicants to believe that they cannot navigate the system without professional help.

Pressure Tactics and False Promises

Applicants may feel pressure to sign contracts without fully understanding the terms. Predators may promise quick approval or imply that failing to use their services will result in denied benefits, exploiting the applicants’ desperation and urgency.

Lack of Transparency

Many for-profit companies do not clearly disclose their fees, the scope of their services, or the potential outcomes. This lack of transparency leaves applicants vulnerable to unexpected charges and unmet expectations.

Unethical Practices with Veterans

Veterans are a specific target for many of these companies. Some organizations claim to offer “free” services to veterans but later charge hidden fees or persuade veterans to apply for benefits they are not eligible for, leading to financial and legal complications.

Legal and Ethical Concerns

The practices of these for-profit companies raise significant legal and ethical questions. The legality of their operations often hinges on state regulations, which can vary widely and are frequently inadequate in protecting consumers. The ethics of exploiting individuals who are already vulnerable because of disability or military service are equally questionable. Misleading applicants and pressuring them into expensive contracts exacerbates their financial and emotional distress.

Regulatory Gaps and Inadequate Consumer Protections

Many states lack comprehensive regulations governing for-profit companies offering benefits application services. This lack of oversight allows unethical practices to flourish. Current laws often fail to protect applicants from predatory practices, and enforcement against violators is inconsistent.

The Need for Reform and Consumer Protection

Addressing the exploitation of disabled individuals and veterans by for-profit companies requires comprehensive reform and enhanced consumer protections. Some ways to combat the spread of these for-profit firms include the following.

  • Strengthening Regulations: Governments could implement stricter regulations for for-profit companies offering benefits application services, including caps on fees and mandatory transparency in advertising and contract terms.
  • Enhanced Enforcement: Regulatory agencies must have the authority to enforce existing laws and take swift action against companies engaging in predatory practices.
  • Public Awareness Campaigns: Educating the public about the availability of free or low-cost assistance through nonprofit organizations and legal aid can reduce reliance on for-profit companies.
  • Supporting Nonprofit Services: Increasing funding and support for nonprofit organizations that assist with benefits applications can provide applicants with reliable, ethical alternatives to for-profit companies.
  • Legal Support for Benefits Applicants: Expanding access to legal aid services can help applicants navigate the complex benefits systems without resorting to predatory companies.

Learn More About Avoiding Benefits Predators

The exploitation of disabled individuals and veterans by for-profit companies is a pressing issue that demands urgent attention. Advocates are working to ensure that the most vulnerable members of society receive the support and benefits they are entitled to without falling prey to predatory practices.

Learn more about your rights when applying for benefits by contacting an experienced special needs planning attorney Add Goff today. He can discuss your specific situation and the options available to you.

Supplemental vs. Special Needs Trusts: Any Difference?

/in , /by

Have you heard the terms “special” needs trust and “supplemental” needs trust and wondered what the difference is? The simple answer is that there’s no difference.

Whether supplemental or special, these trusts serve the same purpose of helping meet the needs of individuals with disabilities while still permitting them to qualify for vital public benefits programs. But there are different categories of special needs trusts and important differences between them that warrant a longer explanation.

What’s in a Name? Background on Special Needs and Supplemental Needs Trusts

The field of special needs planning began more than three decades ago with the passage of the Omnibus Budget Reconciliation Act (“OBRA”) of 1993, a law that overhauled Medicaid and authorized the creation of a new special needs trust.

Prior to OBRA, a disabled person under the age of 65 who had assets greater than $2,000 was not eligible for means-tested government assistance programs like Medicaid and Supplemental Security Income (SSI). In the government’s eyes, it didn’t matter if the assets came from an injury or medical malpractice award, pre-disability personal savings, or an inheritance. A disabled person had to remain at or below $2,000 in assets to retain public assistance.

As a result of this policy, the families of disabled individuals faced a stark choice. They could provide financial support for a disabled loved one, but doing so often resulted in the loss of their means-tested benefits. Another option was to disinherit the person with special needs and leave the money to another family member, such a sibling, for the disabled person’s benefit — a risky option at best.

However, a third option emerged: the use of a third-party trust that benefited a disabled person but was funded by family members, often a parent. This arrangement kept the trust funds out of the beneficiary’s Medicaid and SSI means testing consideration.

Congress took a negative view of these third-party trusts and attempted to limit their use. But a compromise emerged when OBRA authorized first-party special needs trusts.

Some practitioners called for distinguishing between these new trusts and third-party special needs trusts by calling the former “special needs trusts” and continuing to call the latter trusts “supplemental needs trusts.” This approach never really caught on, though.

Instead, over time, both types of trusts have come under the rubric of special needs trusts and the term “supplemental needs trust” has fallen away. The term “special needs trust” refers to the purpose of the trust — to pay for the beneficiary’s unique or special needs. In short, the name is focused more on the beneficiary, while the name “supplemental needs trust” addresses the shortfalls of public benefits programs.

More than 20 years after OBRA was passed, in December 2016, President Obama signed the 21st Century Cures Act into law. Section 5007 of the Act (“Fairness in Medicaid Supplemental Needs Trusts”) further modernized special needs trusts, allowing a person who meets the government’s definition of “disabled,” yet who is also mentally capable, to establish their own first-party special needs trust, rather than relying on a third party to set it up for them.

First-Party vs. Third-Party Special Needs Trusts

Special needs trusts (SNTs) now encompass both traditional third-party trusts and first-party trusts created under OBRA. They can hold many types of assets, including cash, real estate, investments, and life insurance policies.

  • Special needs trusts funded with assets belonging to a person other than the disabled beneficiary (such as a parent, grandparent, sibling, or some combination of family and other individuals) are referred to as third-party special needs trusts.
  • Special needs trusts funded with assets/income belonging to a disabled individual who is also the trust’s beneficiary are called first-party special needs trusts.

First-Party Special Needs Trust

First-party special needs trusts derive their name from the fact that they hold assets belonging to the beneficiary of the trust (i.e., first-party assets). They’re also known as:

  • (d)(4)(A) trusts (referring to the statute)
  • Pay-back trusts (referring to the feature that any funds remaining in the trust at the beneficiary’s death must be used to reimburse the state Medicaid agency)
  • Self-settled trusts (referring to the fact that these trusts are created with the Medicaid beneficiary’s own funds)

First-party SNTs are typically set up by a person with special needs, or on their behalf, who has assets but still wants to qualify for means-tested public assistance (e.g., Medicaid and SSI).

Often, these assets come from a lawsuit settlement or an inheritance. But in order for the trust’s assets to not be counted for Medicaid/SSI purposes, the beneficiary must, by law, be under the age of 65 when the trust is established and funded.

Third-Party Special Needs Trust

Third-party SNTs are set up by the family members of a special needs individual. Like a first-party SNT, the primary intent of a third-party SNT is to provide financial support to somebody with a disability or functional needs while not jeopardizing their means-tested government benefits.

There are two main types of third-party special needs trusts: standalone and testamentary.

  • Standalone third-party SNTs are effective as soon as they’re created and eligible to hold assets from more than one third-party source, usually multiple family members and/or family friends, both during the creator’s lifetime and after. Standalone SNTs can provide cost savings because only one trust is created, but it can pool assets from different individual benefactors.
  • Testamentary third-party SNTs are created through the estate plan of a third party, taking effect at the time of their death. When the creator passes away, assets specified in their estate plan transfer into the special needs trust. A testamentary SNT can be set up as a dual-purpose trust that allows the creator to keep assets in the trust they need during their lifetime, and then have those assets later transfer to a disabled beneficiary.

Similarities and Differences Between First-Party SNTs and Third-Party SNTs

First-party and third-party special needs trusts serve the same end: to offer supplemental assets to a disabled beneficiary without disqualifying them from Medicaid, Social Security, and other public benefit programs.

These programs usually provide a level of support that only meets a person’s most basic needs. Special needs trusts can therefore help to ensure that beneficiaries have access to more resources and enjoy a higher quality of life.

But while both types of SNTs serve the same goal, there is a major difference between them when it comes to government benefit reimbursement.

  • With a first-party SNT, after the beneficiary dies, the state Medicaid agency can collect reimbursement for payments made to them during their lifetime. Sometimes, whatever funds remain in the trust are fully exhausted to meet this demand. Once Medicaid gets their cut, the trust balance can pass to other beneficiaries named in trust documents (so-called “remainder beneficiaries”).
  • Third-party SNTs are not subject to Medicaid reimbursement. When the beneficiary dies, all remaining trust assets are eligible to pass to remainder beneficiaries. The government is not entitled to a Medicaid “clawback.”

The reason for this difference is that first-party SNTs are funded with first-party money belonging to the beneficiary, while the assets held in a third-party SNT never belonged to the beneficiary. It’s a legal technicality, but an important one.

Choosing a Trustee for a Special Needs Trust

When setting up a first-party or third-party SNT for a disabled loved one, among the most important decisions is who will serve as trustee, or the party that manages the trust on behalf of the beneficiary.

A trustee can be a person, like a family member or friend, or a professional trust administrator, such as an attorney or a financial institution. More than one party can simultaneously serve as trustee. It’s also a good idea to name a successor trustee to take over for the original trustee(s) when they are no longer able to serve.

Whoever you choose to serve in this rule, choose wisely. The responsibilities of a special needs trust trustee are crucial to maintaining a beneficiary’s public assistance eligibility.

The trustee must understand the trust’s terms and benefit regulations and only pay for expenses that an SNT can cover. The trustee is also responsible for managing trust investments and acting in the best interest of the beneficiary.

For these reasons, a professional trustee might be a prudent choice for administering a special needs trust, or at the very least co-administering it with a family member to ensure full legal compliance.

To discuss these and other legal issues surrounding SNTs, including which type of trust should be used in your situation, consult with your special needs planner.

Preventing Guardianship Abuse of People With Disabilities

/in , /by

Woman in her 30s wearing a neck brace and sitting in a wheelchair alone outdoors.If you have a loved one living with a disability, you should be aware of the signs that these individuals may be facing abuse or exploitation in the guardianship system.

Legal Guardianship

An individual living with certain disabilities may benefit greatly from having a legal guardian. (Note that some states use the term “conservator” rather than guardian.) If a person with the disability cannot make decisions crucial to their well-being, a guardian can support them. Guardians are responsible for serving in the best interest of the person with the disability, their ward.

A guardian or conservator can assist the ward in many areas of their lives. This may include managing the ward’s assets or securing housing that suits their unique needs. Different levels of guardianship can dictate what level of control a guardian has over their ward.

Downsides of Guardianship

The process of appointing a guardian or conservator can be time-consuming and costly. It may also require ongoing court supervision. Although this can be beneficial for preventing abuse, it can also make management of assets somewhat cumbersome.

A guardianship can sometimes also prove more restrictive than necessary. In some cases, a guardian or conservator may have control over their ward’s personal decisions. You may recall when Britney Spears accused her father (and conservator) of having too much control over her life and her assets. Fortunately, alternatives to guardianship are available in many states, including limited guardianships and supported decision-making.

Sadly, some people serving as guardians, even family members, may take advantage of their wards. People with disabilities can be more likely to suffer physical, mental, financial, and other types of abuse than others. Certain impairments might prevent someone from protecting themselves from physical abuse. Mental illness could lead an individual to be more trusting of those who are seeking to exploit them financially.

The bottom line is that people with disabilities, as well as their friends and families, need to know how to recognize and combat abuse.

Signs of Abuse

Abuse can occur despite your best efforts, so it pays to be on the lookout for signs that someone is taking advantage of a person with disabilities. Here are some things to look for:

Physical Abuse

  • Unexplained bruising or other injuries
  • Preventing the ward from seeing their doctor
  • Poor hygiene
  • Improperly cared for injuries or infections
  • Dehydration
  • Malnourishment

Financial Abuse

  • An unfamiliar person brings the person with disabilities to the bank
  • The individual with the disability cannot explain where their money goes
  • Bounced checks or unauthorized withdrawals
  • A caregiver or family member isolates the person with disabilities from other family members or friends

Emotional Abuse

  • Isolating the ward from their loved ones, or preventing them from receiving mail or phone calls
  • Sudden change in behavior or increased emotional distress
  • Depression
  • Anxiety

Preventing Abuse

The best way to prevent abuse in the first place is to remain active in your friend or loved one’s life. If a person with a disability lives in a group home or nursing facility, consider visiting regularly. This can give you an opportunity to spot signs of abuse quickly.

Get to know your loved one’s guardian and caretakers if possible. The more tuned into you are to a ward’s life, the more likely you’ll be able to put a stop to problems before they become more serious.

If someone you care about with disabilities has access to a significant amount of money, you may consider creating a special needs trust for their benefit. This can help protect their finances.

What Is a Special Needs Trust?

A special needs trust is a type of trust that can help a person with disabilities pay for certain expenses. With this trust, an independent trustee manages funds in the trust. They can serve as a buffer between the person with the disability and those who may be looking to take advantage of them.

Available Resources to Report and Stop Guardianship Abuse

With the intervention of a court, it is possible to remove a guardian or limit a guardianship. This may be necessary when a guardian is abusive or fails to carry out their duties.

If you suspect that a disabled loved one is a victim of abuse, immediately document your concerns and contact the proper authorities. For guidance, reach out to your special needs planning attorney as soon as possible. They have expertise in the guardianship laws specific to your state.

The following resources also may prove essential:

Do not hesitate to speak up if you recognize signs of abuse; your loved one’s life could depend on it. Remember that the best prevention is to be involved from the start.

Employment Up for People With Disabilities But Gaps Remain

/in /by

Female employee who uses cochlear implant for hearing impairment at her place of employment.Thirteen percent of Americans experience a disability, according to 2023 data. Having a disability can shape one’s life in many ways. One area it can impact is employment.

The U.S. Bureau of Labor Statistics recently published its 2023 report on employment among people with disabilities. Per the findings, the disability community last year encountered an increase in employment – its highest rate on record.

Despite this, workers with disabilities experienced higher unemployment rates across all age groups compared with people with no disability. Living with a disability also correlated with how much people worked and what kind of work they did.

Employment of People With Disabilities

Workforce participation rose last year, with about 22 percent of people with a disability holding a job. In fact, the employment rate among people with disabilities reached its highest level since 2008, when data collection began. From 2022 to 2023, the employment rate rose by 1.2 percentage points.

Yet the rate of employment was still lower for people with disabilities than for those without disabilities. In part, this reflects age; older workers are less likely to participate in the workforce. (Nearly half of the disabled population comprises adults 65 and older. Only about 17 percent of people without a disability fall into this age range.)

Across all age groups, people with disabilities were nevertheless less likely to be employed. Employment rates were also lower among workers with disabilities regardless of their education level. While 22 percent of people with disabilities in the labor force had employment in 2023, 68 percent of people without a disability did. Even at the highest levels of education, there were significant differences in employment rates.

Part-Time Employment and Types of Work

The nature of work also tended to be different. For one, individuals with disabilities were almost twice as likely to work part-time. Twenty-nine percent of people with a disability work part-time, compared with 16 percent of workers without a disability. Part-time work may suit some individuals with disabilities because it offers a more flexible schedule.

Also offering flexibility, self-employment was more common among those with disabilities, too. A less rigid work schedule can help people complete work while managing a chronic condition.

The report also revealed disparities across areas of employment. Individuals with disabilities were more likely to work in service occupations, production, transportation, and material moving occupations, and sales. They were less likely to work in management, professional, and related occupations. While slightly more likely to have a job with the federal government, they were less likely to work in the private sector.

Unemployment Rate

Someone is unemployed when actively looking for work but unable to find it. The unemployment rate was twice as high for people with disabilities, at 7.2 percent, in 2023. A greater proportion of people with disabilities who want work remain without a job.

Not in the Labor Force

Many people with disabilities are not in the labor force. Unlike those who are unemployed, they are not seeking work.

About three-quarters of people living with disabilities were not in the labor force in 2023, and most did not want a job. Although deciding not to work can be related to age, people with disabilities were still more likely to be out of the workforce across all age groups than people with no disability.

Summary of Key Findings

The Bureau of Labor Statistics based its findings on survey data from approximately 60,000 households. As seen above, the 2023 report sheds light on employment differences between workers with and without disabilities, including the following:

  • Although a greater proportion of people with disabilities participated in the workforce in 2023, they still experienced a higher unemployment rate.
  • Compared to individuals without disabilities, they were more likely to work part-time or work for themselves.
  • They were also less likely to hold executive or professional roles.
  • Roughly three-quarters of adults with disabilities were outside the labor force.

Speak to an Advocate

If you or a loved one with a disability are looking for work or need help accessing health care or other benefits, consider working with an attorney. A qualified special needs planning attorney can help you assess your options and create a plan to increase your income through work or public assistance.  Go to our website at www.GoffandGoffAttorneys.com or call 318-255-1760. 

 

A Parent’s Situation Can Shift Child’s SSI to SSDI Benefits

/in /by

Mother and adult son with Down syndrome sitting on bench in garden.

Because of their disability, a person receiving Supplemental Security Income (SSI) may not have worked long enough to qualify for Social Security Disability Insurance (SSDI) benefits on their own work record. Therefore, once they meet the government’s strict physical or mental disability requirements and fall under SSI’s income and asset caps, the SSI recipient might assume that they will never obtain SSDI benefits in the future.

However, this is not always the case. In fact, many SSI recipients who became disabled prior to turning 22 years old may begin to receive SSDI benefits when one of their parents retires, becomes disabled, or passes away.

Can a Grown Child Collect Parents’ Social Security?

SSI recipients (and anyone else, for that matter) may qualify for the Disabled Adult Child (DAC) Program if they became disabled prior to turning 22 and if one of their parents paid into the Social Security program for the required number of quarters.

If the parent retires or becomes disabled, the child will receive 50 percent of the parent’s Social Security benefit. If the parent dies, the payment increases to 75 percent of the parent’s benefit. These payments trigger when the parent applies for Social Security, or someone informs the Social Security Administration (SSA) of the parent’s death and about the child with disabilities. Once informed, the SSA will begin making SSDI payments directly to the disabled adult child.

What to Watch Out For

If an SSI recipient suddenly begins receiving an SSDI payment, those additional funds could cause them to lose SSI if the amount they receive from their parent’s work record is greater than their current SSI benefit. Fortunately, SSI recipients in this situation do not lose access to Medicaid so long as the beneficiary is single or married to another person who is also receiving DAC benefits.

The receipt of additional SSDI funds does disqualify them from Medicaid, which would normally result from a loss of SSI. In addition, after the individual with SSI benefits receives two years of SSDI payments, they will also begin to receive Medicare benefits. As a result, although they might not receive their SSI cash award, they will have a larger SSDI payment and gain access to more insurance options – a win for the SSI recipient.

There is one other situation where an SSI recipient could acquire SSDI in the future. That is when they work for enough quarters while receiving SSI to eventually qualify for SSDI on their own work record. Although this situation is extremely rare, it does happen, so SSI recipients who are working limited hours should track their employment history carefully to find out when they are eligible for SSDI instead.

Your special needs planner can help you and your family navigate these complicated transitions. As always, you should consult your planner in advance of retirement or any other major life change to determine the effect of your actions on your loved one with disabilities. To get the help you need, contact Ruston, La. – based Special Needs Planning attorney Addison Goff. Visit www.GoffandGoffAttorneys.com or call 318-255-1760. 

Lifetime Money Management for Children With Disabilities

/in /by

Smiling child who uses wheelchair in front of drawing of two muscular arms on a blackboard.Children with disabilities present a unique challenge for parents who are looking to engage in estate planning. For one, you will want to optimize your estate to use, enhance, and enrich assets for your child. At the same time, maintaining their enrollment in public benefits programs is no doubt going to be essential.

To ensure you meet both of these objectives requires careful planning. An experienced attorney can prepare a special needs trust to accomplish these and other goals you may have for your child.

How a Special Needs Trust Works

Qualifying for means-tested assistance programs, such as Supplemental Security Income (SSI) or Medicaid, typically requires benefits recipients to meet strict financial criteria. A special needs trust can help an individual with disabilities meet these stringent rules. This is because the assets held in this type of trust are not directly available to the child.

A trustee of a special needs trust provides benefits to the child via the trust. Parents should select this trustee with great care. The trustee will act as the child’s money manager, ensuring proper supervision of their finances in the event that the child’s parents pass away.

A letter of intent can also be a powerful tool that helps to guide the trustee in making decisions that will best serve the child’s unique needs. 

Choosing a Trustee for a Special Needs Trust

In most cases, your child will benefit from you selecting a dependable individual to serve as their special needs trustee. You may wish to select a person who is not a family member and who would be independent in carrying out this role.

You have a range of options, including the following:

  • A parent, sibling, or another relative (which, again, can be risky)
  • An experienced estate planning attorney or special needs planning attorney
  • A financial institution or a trust company
  • A nonprofit organization, particularly one with special needs experience
  • Co-trustees, such as a trust company, acting in conjunction with a family member

Each of these options can have advantages and drawbacks. Keep close counsel with your estate planning attorney or financial advisor before you select a trustee.

When to Set Up Your Special Needs Trust

The creation of your special needs trust can happen while you are living or at the time of your death.

Parents often set up the trust while alive; this is known as a living trust (or inter vivos trust). A living trust boasts certain advantages, such as:

  • avoiding probate;
  • permitting other family members (for example, grandparents) to make trust contributions; and
  • giving a co-trustee the opportunity to experience what it’s like to administer the trust.

Alternatively, a last will and testament can incorporate creating the trust, known as a testamentary trust.

Types of Trusts

Note that whether a trust is revocable or irrevocable affects tax consequences.

Generally, a revocable trust can be changed at any time and so is used to maintain maximum control over the trust. With this type of trust, income tax considerations are not a concern.

Irrevocable trusts, which cannot be changed once they are created, are often used to minimize income tax consequences, particularly if the trust funds exceed $1 million dollars. In this instance, both federal estate and gift taxes may apply to the trust.

A special needs trust is usually irrevocable and may be a first-party or third-party trust, depending on how you choose to fund it. Relinquishing control of the trust to a trustee protects your child’s government benefits. which can be vital to maintaining their health and living arrangements.

Money in the trust will not be counted toward income or asset limits by Medicaid or Social Security programs. This ensures that your child will continue to qualify for the support they need while also being able to receive gifts from family members that may further enhance their quality of life.

Why Special Needs Trusts and Estate Planning Are Important

Verbally telling your family how to care for your child is insufficient. In the absence of a will or trust, the state in which you live may determine the outcomes of your estate’s distribution. This situation is not a viable option for a child with special needs or any of your children.

Receiving proper legal guidance on the appropriate trusts to use in your estate plan is crucial to your child’s future. Do not attempt to craft these legal documents on your own, use existing forms, or copy an online internet template. Each child with special needs requires careful considerations unique to them and the challenges they face.

With so much at stake, be sure to seek out the expertise of your attorney. They can tailor your estate plan to best suit your wishes as well as the specific needs of your child. Protecting public benefits such as Supplemental Security Income (SSI) and Medicaid will help safeguard your child’s well-being into the future. Establishing a special needs trust through the estate planning process is a key way to achieve this goal.  .

To get the help you need, contact Ruston, La. – based Special Needs Planning attorney Addison Goff. Visit www.GoffandGoffAttorneys.com or call 318-255-1760. 

 

Planning for Children and Adult Children With Special Needs

/in /by

Close-up of smiling young Latina woman with Down syndrome.Individuals with special needs may have a developmental disorder, such as autism, ADHD, or Asperger’s syndrome. They may have an intellectual disability such as Down syndrome. Or, perhaps they have a learning disability such as dyslexia or physical impairments that affect their vision or hearing. People with other serious or chronic health conditions, such as cystic fibrosis or epilepsy, may count as special needs.

The US government combines this group into the overall class of disability. Current data estimates the US population of people with disabilities comprises more than 42 million individuals.

Making plans that address your child’s experience while living with physical and cognitive impairments requires careful thought and planning. When looking toward their future, consider your child’s ability to make decisions and find the resources they will need. If you can provide for them financially, this will allow them to live on their own to the fullest extent possible.

At the same time, using specific legal arrangements to protect their best interests is crucial. There will likely come a time when you are no longer around or able to help. The foundation for continued care you set today will ensure your child has the best possible chance for a successful future.

Special Needs Planning

Achieving your planning goals begins with understanding the financial implications of your loved one’s situation. The top priority is typically providing financial security for your child with special needs. Much of this security will come from government services like Social Security Disability Insurance (SSDI), Supplemental Security Income (SSI), and Medicaid.

A special needs trust or a life insurance policy can further enhance your child’s financial future. Work closely with your special needs planning attorney to incorporate financial resources or gifts into your special needs plan. They can help ensure that your child remains eligible for invaluable government programs. In addition, they are familiar with maintaining all possible avenues of support through legal techniques.

Creating a Support Team

Beyond securing their financial future, as a family, you need to identify your child’s support team. First, be sure to select a guardian to make medical or life decisions for your adult child if they are unable to do so. Naming a backup guardian is also common practice.

If there is a special needs trust in place, you must appoint a trustee to oversee the trust. Having a trustee different from the named guardian is an excellent checks and balances system. If possible, involve your special needs child in the discussions and planning process. Individuals living with a disability want a say in who they’d prefer to have involved (or not) in their lives.

Parents may struggle to trust others with the care of their child with special needs as they age. It can be difficult for them to believe that someone else is capable of providing the same level of care. Each family must work out issues and make compromises, keeping the child’s best interest in focus.

Professional personal care assistance can relieve the principal care provider, usually the guardian, and give families extra flexibility. Some care options to consider include:

  • Family members – Many individuals with special needs choose to remain with relatives. Typically, the family knows the child’s routines and preferences best. However, this may leave family members serving as unpaid caregivers, putting their earning potential and future at risk. Sharing family responsibility and rotating caregiving may alleviate this problem, yet it may not be ideal for the person with special needs.
  • Personal care professionals – Known as PCAs, these caregivers are the main method of non-family care. Duties include organizational or housekeeping tasks, bathing, dressing, ventilator or catheter care, and transportation. Although you can hire a PCA through an agency, many families opt to hire and train individuals directly. In either case, proper vetting is a must.
  • Community-based homes and supported living arrangements – Some adults with special needs are capable of living in group homes. Here, they can live with independence and some support. Care providers who live or work in these settings offer services ranging from medication assistance to decision-making. This living arrangement is typically communal with shared activities, including meals and social groups.
  • Independent living arrangements – Many adults with special needs can live on their own with a PCA’s support as needed. Some individuals may only require a few hours of PCA care daily to help with morning routines or mealtimes. Others have several PCAs providing 24-hour care in rotation. Sometimes there is an arrangement with a housemate or roommate to provide backup support in exchange for a break on rent.
  • Assistive technology (AT) – The digital age has given rise to many assistive devices providing greater options for independence. AT allows people with disabilities to control their home environment, take their baseline medical readings, or access the internet.
  • Day programs – Young adults with special needs may attend public schools until they turn 21. As these young adults transition to adulthood, some day programs provide similar continued education and structure. Such services and programs can help in enhancing their life skills while maintaining social bonds with a community of their peers.
  • Long-term care facilities – In recent decades, there has been a movement away from care in institutional settings. However, a residential facility may prove to be the best option for certain situations. For instance, there may be limited access to or long waiting lists for community care or other types of support.

Drafting a Letter of Intent

Create a letter of intent (LOI) to help add another layer of protection for your child into the future. An LOI can provide a general overview of your child’s life. It might address family history, your child’s daily schedule, medical care, education, or public benefits on which they rely. You may also consider including information on the following:

  • Employment hopes
  • Residential social and religious environments
  • Behavior management
  • Foods (including any allergies)
  • Hopes for their future

You can also explain expectations for your child’s final arrangements for funeral services and burial.

Some options for your child’s future are only available with additional private funding. However, with the right planning, all children and adult children with special needs can qualify for appropriate life care.

Discuss care options with your special needs attorney as your first step in creating the best plan possible for your child. 

To get the help you need, contact Ruston, La. – based Special Needs Planning attorney Addison Goff. Visit www.GoffandGoffAttorneys.com or call 318-255-1760. 

Choosing Trustees for Special Needs Trusts: Four Things to Consider

/in /by

View of man's shoes on floor with arrows pointing in three different directions in front of him.Choosing the right person to serve as trustee of a special needs trust (SNT) is a key task when creating such a trust. It may also prove to be one of the most challenging. Trustees are responsible for the following:

  • managing the day-to-day operations of the SNT,
  • making distributions to the trust’s beneficiary,
  • investing the trust’s assets, and
  • paying the trust’s bills.

This, in turn, helps ensure that the special needs trust’s beneficiary remain eligible for public benefits programs.

The law is not particularly strict about who may serve as trustee. The trustee must be over 18 years of age and capable of managing their own affairs. They can be the child’s parent or other relative or a trusted friend. Or they can be a professional such as a lawyer, accountant, trust company, bank, or private professional fiduciary.

Here are five important questions to ask yourself when deciding on who should serve as a trustee for a special needs trust:

1. Is the potential trustee knowledgeable about public benefit programs?

It can prove crucial for a trustee of a special needs trust to be familiar with the different types of public benefit programs. They will be responsible for ensuring that the special needs trust beneficiary remains eligible for their public benefits.

Many government benefits like Medicaid, Supplemental Security Income (SSI), and Section 8 housing have complicated rules governing SNTs. The trustee of a special needs trust must know these rules well. Or they at least need to work closely with a special needs planner who can explain the consequences of their actions as trustee.

2. Does the trustee have time to carry out their duties?

Serving as the trustee of an active special needs trust can seem like a full-time job. Depending on the needs of the beneficiary, the trustee could indeed spend a good deal of time on any number of tasks. These may include the following:

  • paying bills,
  • monitoring government benefits,
  • helping to secure housing,
  • paying for medical care, and
  • serving as a link between the beneficiary and a variety of service providers.

Sometimes, trustees find that they can’t perform all the necessary tasks in a timely manner. Or they feel they’re sacrificing their family life or other professional obligations to fulfill their duties as a trustee. If this is the case, it may be time to look for a professional trustee.

3. Should you consider a professional trustee?

Professional trustees can be an attorney, accountant, trust company, investment firm, bank, or private professional fiduciary. With a professional serving as a trustee, you can rely on the expertise of that individual or institution. They will have a deep understanding of public benefits programs, investments, money management, and tax planning. Another advantage is that you may stand to gain some emotional distance.

Sometimes, a beneficiary may have certain demands for trust distributions that can cause significant problems for family members. Again, having a professional trustee in place can help you avoid these kinds of family complications.

4. How comfortable are you giving control over the trust to an outsider?

Perhaps you feel uncomfortable with the idea of an outsider managing your loved one’s special needs trust. Keep in mind that it is possible to appoint a family member and an independent trustee as co-trustees. This way, you can rest assured that there is one trustee who is familiar with the beneficiary and has their best interests at heart. At the same time, the co-trustee can help carry out the tasks necessary to meet the public benefit programs’ requirements.

Another option is to appoint a trust protector. A trust protector has the powers to review accounts and to hire and fire trustees. In addition, a trust advisor can help instruct the trustee on the needs of the beneficiary.

Consult With Your Special Needs Planning Attorney

Make sure that whomever you choose as an SNT trustee is financially savvy, well-organized, and, most important, ethical. Work with your special needs planner to make the best choice. To help with your Special Needs Planning, contact Elder Law and Estate Planning Attorney Add Goff of Ruston, La. at 318-255-1760 or info@GoffandGoffAttorneys.com.

What Is the Social Security Disability 5-Year Rule?

/in /by

Young woman pushes young man with a disability who uses wheelchair across living room.Social Security Disability Insurance (SSDI) provides financial assistance to workers who become disabled and their families. The Center on Budget and Policy Priorities reports that 7.4 million Americans received Social Security disability benefits in 2023.

Unlike Supplemental Security Income (SSI), which supports people with disabilities or of advanced age who have limited means regardless of work history, SSDI is an earned benefit. Before becoming disabled, the worker must have paid into the Social Security program through taxes to be eligible for benefits.

When you apply or reapply for SSDI benefits, there are two five-year rules to remember: One concerns the work credit requirement. The other involves reapplying for benefits.

Qualifying for Social Security Disability Insurance

The eligibility criteria for SSDI involve disability, income, and work history.

  • Your disability must meet the Social Security Administration’s strict standards.
  • Your income must be below the substantial gainful activity (SGA) amount. For 2024, the SGA is $1,550 per month for people with disabilities other than blindness (For blind people, it is $2,590 per month.)
  • You must also have earned sufficient work credits and worked recently enough. You must have earned enough work credits before you became disabled relative to your age.

The Five-Year Rule for Work Credits

The five-year rule for work credits helps people aged 31 and older determine whether they have enough credits to qualify for SSDI.

Depending on your income, you can earn up to four credits a year. In 2024, workers earn one Social Security and Medicare credit for $1,730 in covered earnings.

Under the five-year rule, people 31 and older must have worked at least five out of the last 10 years to be eligible for SSDI.

You may work for less than an entire year and still earn the maximum credits. As long as you earned four credits through your income, it does not matter if you earned that income through seasonal work or worked all year. Also, high earners may earn all four credits after only a month of work.

So, per the five-year rule, individuals aged 31 and older must have earned at least the maximum work credits for five out of the past 10 years to be eligible for disability benefits. During that time, they must have accumulated at least 20 credits to qualify.

If you are 30 or under, you’ll need to use a different test to determine whether you have enough work credits to receive Social Security disability benefits. The Social Security Administration determines your eligibility for benefits based on your age, and there are different rules for different age groups.

  • Those under age 24 need at least six credits earned in the three years before the onset of the disability.
  • People between 24 and 31 are eligible if they worked half the time between the age of 21 and when they became disabled.For example, a person who became disabled at age 27 must have worked at least three years, earning 12 credits, in the past six years.
  • Individuals 31 or older must have earned at least 20 credits in the last 10 years before the disability. This is known as the five-year rule.

The Five-Year Exception for Reinstating Benefits

In addition to the rule that helps people aged 31 and older find out whether they have enough work credits, a second five-year rule applies to past SSDI recipients seeking to reapply.

Per federal regulations, you must have a disability for five months before qualifying for benefits. But, this regulation provides an exception. There is no waiting period if you were previously entitled to disability benefits or had a period of disability within five years of the month you became disabled again.

Because of this five-year rule, you do not have to wait five months to receive benefits. However, the exception does not apply if a drug or alcohol addiction contributed to your disability.

Speak With an Attorney

If you seek disability benefits, an attorney can prove indispensable. Special needs planning Add Goff can explain the rules to you and assiste with estate planning to help you determine whether you could qualify for benefits.