The Certified Elder Law Attorneys of Fink Rosner Ershow-Levenberg, LLC, New Jersey, provide individualized hands-on service to assure that your questions will be answered and your needs met. For more information, contact us or call 732-382-6070.
Frequently Asked Questions
SPECIAL NEEDS TRUST
Q. What is a Special Needs Trust?
A This is a specialized trust for sole benefit of a person who is disabled. It restricts the use of the money to supplemental needs, and not support, so that the trust's disabled beneficiary can be eligible for benefits such as SSI, Medicaid, or programs of the Division of Developmental Disabilities (DDD).
Q. How is a Special Needs Trust made?
A We write the Trust and it is established by the beneficiary's parent or grandparent or Guardian, or by a court. The beneficiary's assets can be transferred into the Trust, where the funds will be managed and controlled by a Trustee for the sole benefit of the disabled beneficiary.
Q. Can it be written in the parent's Will?
A Yes. A parent may want to leave money for the benefit of their disabled child. It should go into a Special Needs Trust so that the child doesn't lose important government benefits. In that case, the trust is funded with the parent's assets after death.
Q. Is a Special Needs Trust the same as a discretionary trust?
A No. It must have many specialized provisions for it to be effective in protecting SSI, Medicaid and DDD eligibility.
- Articles Archive: Estate Planning Concerns if a Family Member Receives SSI Benefits
- Practice Areas: Special Needs Trust, Medicaid, Social Security Disability
Q. Does everyone need a Will?
A. Yes. In the Will, you decide who gets what. You can leave money to charities or to trusts for specific beneficiaries. You can divide the estate unequally among your heirs. You appoint a person of your choice as Executor to carry out your wishes, and you can specify that the Executor can serve without bond.
Q. What if a person dies without a Will?
A. The Surrogate's Court will have to appoint an administrator from among the heirs, and s/he must post a bond before being able to assume his or her duties. Then, state law will dictate how to distribute the estate. This may cause results you wouldn't like.
Q. Can't the executor put an heir's share into a trust?
A. The executor must follow the terms of the Will. If there is no Will, the Administrator must give the assets to the heir. Under certain circumstances, the Executor or Administrator could petition a court to create a trust for one of the heirs, such as a special needs trust.
Q. What is a Life Estate?
A. A Life Estate is an interest in real property that is owned by another person. The Life Tenant has the exclusive right to occupy the premises. S/he is responsible for the utilities, taxes and general upkeep. If the property is sold, s/he receives a pro rata share of the sale proceeds based on his or her age at the time of sale. The owner of the property is called the "remainderman."
Q. What happens when the life tenant dies?
A. If the life tenant gave the property to another person (such as a child) and kept just the life estate, the life estate would be a retained interest. The whole value of the property would be included in the life tenant's estate at death, when calculating the estate and inheritance taxes. The cost basis of the property then "steps up" to date of death value, which can benefit the remainderman. The remainderman owns the entire value of the property since the life estate "evaporates" at the death of the life tenant.
Q. Why do people use life estates?
A. Transfer of property to children and retaining a life estate can be a useful tool especially if the parent continues to reside in the home and the property has increased greatly in value since date of purchase. Also, by retaining a life estate, the elderly home owner preserves his or her ability to apply for a reverse mortgage, should additional funds be required to remain in the home.
- Articles Archive: Forms of Real Estate Ownership and Their Attributes
- Practice Areas related to Life Estates: Real Estate Law, Estate Planning
Q. What is Estate Planning?
A. Estate Planning refers to preparation of a Will, a Trust, and any other documents that will direct the handling of your assets during your lifetime or after your death.
Q. Why Do I need Estate Planning?
A. By doing estate planning, you make the choices about who receives each asset, the percentages of distribution, the timing of distribution, and the use of certain property. You make the choices as to who will have the responsibility to carry out your wishes. Also, you may be able to avoid unnecessary estate taxes.
Q. What issues will my attorney ask about?
A. Along with a review of how much of the estate will be left for each person, we will discuss special situations. There may be a child who needs to remain in the house. There may be a disabled beneficiary who needs a special needs trust. Your children may not trust each other, may be fighting, or may have creditor or divorce problems of their own. You may need an independent person or a bank to be the Executor or trustee. You may want to set up a charitable trust. All of these issues can be addressed in the Will, and in trusts set up during your lifetime.
Q. What is Veteran's Compensation?
A. A monthly benefit provided based on the veteran's disability percentage rating.
Q. Am I eligible for a veteran's compensation benefit?
A. A veteran is eligible to receive compensation if s/he is presently suffering from a service connected or service-exacerbated injury.
Q. What is a Veteran's Pension?
A. A need-based benefit for a disabled veteran whose unreimbursed medical expenses exceed
his/her monthly income. This benefit has a cap, adjusted annually, and is calculated using the
unreimbursed medical expenses incurred monthly.
Q. My mother is 69 years old and in pretty good health. Is she eligible for a veteran's pension benefit?
A. Maybe. Veterans or their widows/ers aged 65 and up are presumed 100% disabled, but the veteran must meet the following criteria:
- Served in active duty for 90 days, with a least one day during a time of war.
- Received an honorable discharge from service.
Q. What is Aid & Attendance and Homebound Pension?
A. A special type of pension benefit provided for a veteran in need of skilled nursing services, whether in the home (home bound), assisted living, or in a nursing home (aid and attendance).
Q. Will Aid & Attendance cover the monthly nursing home bill?
A. Maybe. The pension benefit will increase the amount of income available to the veteran; however, in most cases, it is highly unlikely that the benefit will cover all nursing home expenses.
Q. I may place my father in a state VA nursing home. Am I required to spend down his assets like in the Medicaid program?
A. No. The Veterans Administration does not require an asset spend-down. Instead, the VA will review the veteran's net worth.
Q. Does the state Veteran's Administration have a 5-year look back period like Medicaid?
A. No. There is currently a 3-year look back period; however, the VA does not impose a transfer of resources penalty. Instead, transfer made during the look-back period will be counted in the net worth calculation.
Q. My application for veteran's benefits was denied. What can I do now?
A. Upon receipt of the unfavorable rating decision (compensation) or denial (pension), immediately file a Notice of Disagreement, and contact our offices for a consultation, 732-382-6070.
- Articles Archive: Veteran's Improved Pension as an Elder Law Planning Strategy
- Practice Area: Veterans Disability and Pension Benefits
Q. What is a Guardianship?
A. A Guardianship is an arrangement in which a Court appoints someone to act as the decision-maker for an incapacitated person.
Q. Are there different kinds of guardianship?
A. Yes. The Guardian of the Person makes decisions concerning place of residence, choice of physicians, treatment and healthcare choices, and other personal issues. The Guardian of the Property controls the decisions about income, assets, legal actions, insurance claims, property, and the like. Usually one person is appointed for both roles, but there can be two people, and there can also be co-guardians.
Q. What is Limited Guardianship?
A. If the court finds that the person is incapacitated for certain areas of decision-making but retains capacity for other areas, the Court can limit the scope of the guardianship.
Q. What does the process involve?
A. First, a concerned person, including a hospital or nursing home, who has a stake in the situation, files a Verified Complaint for Guardianship with the Superior Court in the county where the alleged incapacitated person resides. The Complaint must include Certifications from 2 physicians or a physician and a psychologist who have examined the person within the previous 30 days. The Court will appoint a lawyer to represent the alleged incapacitated person.
Q. Why does the Court appoint a lawyer?
A. This is to protect the due process rights of the alleged incapacitated person, whose rights are taken away if a guardian is appointed.
Q. Do other family members have to be notified?
A. Yes. Formal notice must be given to them. If they wish to object, they must file an Answer in Court if they want the Court to consider their objections. If they do not object, it may be difficult to go back to court later on.
Q. What happens if the person previously signed a Durable Power of Attorney?
A. This should be brought to the Court's attention right away, as it may affect the Court's decision on how to proceed with the case.