The Role of Special Needs Trusts in Estate Planning - PowerPoint PPT Presentation

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The Role of Special Needs Trusts in Estate Planning

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A look at special needs trusts in New York and why it is considered an essential part of a comprehensive estate plan. – PowerPoint PPT presentation

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Title: The Role of Special Needs Trusts in Estate Planning


1
The Role of Special Needs Trusts in Estate
Planning
The Law Offices of Saul Kobrick, P.C.
2
Special Needs Trusts are also known as
Supplemental Needs Trusts
3
Their purpose is to provide clarity in ones
expectations when hes disabled
4
It is sometimes used as part of a will however,
its always deemed part of a total estate plan
5
These are crucial legal documents that allow
those with physical or mental disabilities or who
has a chronic or terminal illness the opportunity
to protect his assets
6
Not only that, but they dont have to be counted
as part of his assets determining eligibility for
government benefits
7
A few of those benefits might include
8
A few of those benefits might include
1
SSI (supplemental security income)
9
A few of those benefits might include
1
SSI (supplemental security income)
2
Medicaid
10
A few of those benefits might include
1
SSI (supplemental security income)
2
Medicaid
3
Various rehabilitation programs
11
A few of those benefits might include
1
SSI (supplemental security income)
2
Medicaid
3
Various rehabilitation programs
4
Housing
12
Valuable Estate Planning And Investment Tool
13
These trusts may
14
Be established at any time before the
beneficiary s 65th birthday
These trusts may
1
15
Established early in a childs life as a long
term means for holding assets to benefit the
disabled family member
These trusts may
Be established at any time before the
beneficiary s 65th birthday
1
2
16
The costs of creating the trust ARE TAX
DEDUCTIBLE
17
Can be used to safely house funds from third
party sources, such as a personal injury
settlement, Social Security back payments,
insurance proceeds, etc
18
Facts and Misconceptions of Special Needs Trusts
19
Medicaid rules say these trusts may not be used
for day to day expenses such as housing or food
20
They may, on the other hand, be used to ensure a
home is adequately prepared to meet the needs of
the disabled person
21
An example would be WHEELCHAIR RAMPS
22
The food restriction does not apply to vacations,
dinner parties or other entertainment where food
is served
23
Many people assume the trust is designed to cover
their needs for survival only, when in fact, it
can and should be used to bring enjoyment and
new, positive experiences to the beneficiary
24
Other Misconceptions
25
Many assume their wealth means they have no need
for a special needs trust for a loved one
26
Thats not always the case
27
The wealth a family has today may not be enough
to provide for A DISABLED FAMILY MEMBER TOMORROW
28
The assets in the trust will not be counted as
assets and therefore, wont prevent future
benefits and program qualifications
29
More importantly, a trust is off limits to
creditors and may not be seized
30
Even if the beneficiary is sued, the assets in
the special needs trust remain untouchable
31
The Dangers of Not Having Special Needs Trust
32
Its not the best decision to bypass the benefits
of a special needs trust in lieu of placing the
assets with a sibling, with the belief that
sibling will always look after his disabled
brother or sister
33
Siblings disagree even as adults and if that
disagreement is deep enough, it can result in the
adult child seeking revenge against his disabled
brother or sister
34
The person holding the funds could be sued or
file bankruptcy and any assets in his name are
wide open for seizure and it matters none if he
explains those assets are earmarked for a
disabled family member
35
Asset transfers, particularly of the
beneficiarys own funds, other than to the
special needs trusts are often considered
TRANSFERS FOR PURPOSES OF BENEFIT QUALIFICATION
36
They are subject to a 36-to-60 month look back
period, which in effect means that the disabled
beneficiary might not be eligible to receive
benefits for up to five years after the date of
transfer
37
Transfers to special needs trusts are exempt from
this LOOK BACK and do not cause a
disqualification
38
In such circumstances, the assets meant to
benefit the disabled or chronically ill person
could go to pay the judgment creditors or the
estranged spouse of the non-disabled sibling
39
Want to Know More about Estate Planning for the
Special Needs Trusts In New York?
40
Click to visit www.kobricklaw.com
Click to visit www.kobricklaw.com
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