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Special Needs Planning

Estate planning involving a beneficiary with a disability or other “special needs” can be complicated and overwhelming. There are unique questions raised when estate planning for beneficiaries with special needs, including: 

  • Who will care for the beneficiary? 
  • Will the money provided will last for the beneficiary’s lifetime?
  • How can you ensure the beneficiary remains financially eligible for governmental benefits?

Our Palm Beach County estate planning lawyers frequently use trusts and letters of intent to overcome these common concerns.

Trusts for Beneficiaries with Special Needs

One of the most common techniques used in estate planning with a special needs beneficiary is the establishment of a “special needs trust” (or “supplemental needs trust”). 

The purpose of a special needs trust is to permit the trustee to pay for goods or services that are in the beneficiary’s best interest without jeopardizing the beneficiary’s eligibility for means-tested government benefits (such as Medicaid or SSI). 

The terms of a special needs trust should clearly state that the trust is intended to supplement the beneficiary’s government benefits, not supplant them. Furthermore, the beneficiary should be prohibited from having direct access to the trust assets.

Letter of Intent for Beneficiaries with Special Needs

If your estate plan includes a special needs beneficiary and special needs trust, you may also want to consider preparing a Letter of Intent or Letter of Wishes. 

A Letter of Intent informs trustees, guardians, advocates, and others involved in the care for the beneficiary about the beneficiary’s functional abilities, routines, interests, likes and dislikes. 

In particular, this letter can provide guidance to the trustee of the special needs trust with your thoughts and intentions concerning the administration of the special needs trust (such as authorization to hire care managers, advocates, and other professionals who can guide the trustee on trust distributions and payments). While a letter of wishes is not an enforceable legal document, it provides useful guidance to those who will be caring for the special needs beneficiary and managing the special needs trust.

Incorporating Special Needs Planning into your Existing Estate Plan

Another tough decision in planning for a special needs beneficiary is determining how much money should be left to the special needs trust, considering the beneficiary’s lifestyle and necessary support. If there are concerns that available assets will be insufficient, a grantor should consider purchasing life insurance to fund the trust.

Probably the most important and difficult decision is choosing the trustee of the special needs trust. He or she will be entrusted not only with the discretion to make distributions to care for the special needs beneficiary, but also hiring those who will assist with both the administration of the special needs trust and with the direct care of the special needs beneficiary. The trustee will likely be responsible for engaging the following professionals:

  • Financial advisors 
  • Lawyers
  • Accountants 
  • Bookkeepers 
  • Social workers
  • Care managers

The trustee can delegate but is responsible for overseeing everything. If the special needs trust is large enough, a corporate trustee may be an option; however, make sure the bank/trust company has special needs experience and a willingness to administer a special needs trust. You may want to name a trusted individual family member or friend to serve as co-trustee with the corporate trustee.

Our Palm Beach County Estate Planning Lawyers Understand Florida Estate Planning

For more information on special needs planning, contact the Palm Beach County estate planning lawyers of Comiter, Singer, Baseman & Braun either online or by calling 561-626-2101 or toll-free at 800-226-1484. We work with clients in Palm Beach County, including Boca Raton and Palm Beach Gardens, and throughout the state of Florida.

For More Information Or To Schedule A Consultation,Reach Out To Us Online Or Call Us At 561-626-2101

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