BROOKLYN MEDIA GROUP JANUARY 13 - JANUARY 19, 2017 51 THE ELDER LAW MINUTE TM BY RONALD A. FATOULLAH, ESQ. & EVA SCHWECHTER, J.D. Estate planning for parents of special needs children For most parents of children with special needs, government benefits like Medicaid and Supplemental Security Income (“SSI”) are an invaluable resource. These benefits are contingent on a number of eligibility rules, such as the resource limit on a child recipient’s assets. While many parents are familiar with these rules, many are not aware of the potential impact their personal estate plan may have on their child’s benefits. It is important to take into account your child’s unique circumstances when preparing your own estate plan. Parents of children with special needs place their child’s benefits at risk if they fail to create a sound estate plan. In general, when a parent passes away without a will (known as dying “intestate”), his or her assets will be distributed according to state law. These laws generally result in a portion of the estate being left to their children. Receiving these funds can put a child with special needs over the resource limit for many government benefits, and render the child ineligible for assistance. Except in very limited circumstances, parents should not leave anything outright to their child with special needs. Instead, a parent’s estate should flow through his or her will or trust into a special needs trust for the child’s benefit. A properly drafted special needs trust will protect the child’s benefits and allow the estate to be utilized as intended. Parents can also choose a guardian for their minor child in their wills or trusts, rather than leave the choice up to state law. Sometimes parents with multiple children will leave their entire estate to their children without special needs, in the hope that those children will take care of their sibling who has special needs. While this avoids the issue of gifting outright to a child with special needs, it often leads to bitter family disputes, and should be avoided if possible. Typically, the better option would be to leave money outright to the rest of the family, and establish a special needs trust to hold the share of the estate that was intended for the child with special needs. The effects of planning instruments such as life insurance and retirement plans must also be considered. If beneficiaries have not been designated for these assets, their distribution will be controlled by the parent’s will, or by state law if the parent died intestate. This can lead to shares potentially being given outright to a child with special needs. A child’s share of these important assets can be placed into a special needs trust, but it is important to note that there are complicated tax issues which may need to be addressed before doing so. Parents must also remember that their own personal estate plan is not the only potential issue. It is advisable to check with any relatives who may be leaving an inheritance to their children and make sure that they also speak with a qualified attorney before including a child with special needs in their estate plan. To create an estate plan, or to ensure that your current plan is appropriate for your child with special needs, you should contact an experienced estate planning attorney who focuses on planning for individuals with special needs. Ronald A. Fatoullah, Esq. is the principal of Ronald Fatoullah & Associates, a law firm that concentrates in elder law, estate planning, Medicaid planning, guardianships, estate administration, trusts, wills, and real estate. Eva Schwechter is an associate with the firm. The law firm can be reached at 718-261-1700, 516-466- 4422, or toll free at 1-877-ELDER-LAW or 1-877-ESTATES. Mr. Fatoullah is also a partner with Advice Period, a wealth management firm, and he can be reached at 424-256-7273. Except in very limited circumstances, parents should not leave anything outright to their child with special needs. Instead, a parent’s estate should flow through his or her will or trust into a special needs trust for the child’s benefit. REMEMBERING ONE OF NYPD’S FINEST Coney Island’s iconic Parachute Jump lit blue on Tuesday, January 10 to mark the passing of beloved NYPD Detective Steven McDonald. McDonald, who was left paralyzed from the neck down following a 1986 shooting in Central Park and dedicated his remaining years to sharing his story and inspiring others, died earlier that day at the age of 59 following a heart attack on Friday, January 6 that left him unconscious in a Long Island hospital. “He continues to serve as a source of great inspiration to us all,” wrote Coney Island Councilmember Mark Treyger on Facebook upon learning of the local landmark being lit. BAY RIDGE Apartment for Rent · Fully renovated · New kitchen · Newly Painted · 1 bedroom · Near transportation & shopping · Great Location 718 238 6600
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