What You Need to Know About Planning and Gifting

As you age and plan for your estate and your health, how you will distribute and gift your assets is surely an important consideration. In addition to estate planning and gifting, how your taxes and gifts may affect your eligibility for MassHealth (a/k/a Medicaid) is essential to understand. Massachusetts estate planning lawyer Patricia Bloom-McDonald, can help you to understand how gifting may affect your eligibility, and what you can do to preserve your assets.

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Why You Should Not Disinherit Special Needs Family Members

To disinherit a close family member is not a decision arrived at lightly and should not be done without first having a full discussion about the reasons and the consequences. If you have a  special needs child who is receiving public benefits such as SSI, Medicaid and/or MassHealth, then you must be aware of the very strict income limits set by these programs. Consequently, you may be under the mistaken assumption that disinheriting your child is the right thing to do. However, you need to be aware of why disinheriting a special needs child is a poor decision. With this in mind, consider special needs planning.

Public Benefits and Special Needs Family Members

Many special needs individuals are recipients of MassHealth, SSDI for disabled workers, and SSI for disabled adults or those with low incomes. SSI, MassHealth, and Section 8 or subsidized housing are means-tested programs with strict income limits. If an individual who is otherwise eligible or is already receiving such benefits suddenly inherits even a relatively small amount of cash or other assets, this could put that individual’s continued receipt of benefits at risk.

To compensate for disinheriting a special needs individuals, you may have extracted promises from other family members to care for the disabled or special needs individual. This places a huge burden on them so as they become older, have children of their own, and/or need to deal with their own issues; this may promote discord and resentment amongst the entire family. Other individuals who may have participated or contributed to the special needs individual’s care may find excuses to minimize their role or relinquish it altogether. In many cases, illnesses, loss of employment, or other circumstances may force them to no longer contribute.

Further, if you provided funds to another individual to be used to help your special needs family member, those funds are subject to seizure in case of a personal judgment, bankruptcy, or divorce.

Establish a Special Needs Trust

An Special Needs Trust [SNT] is a trust wherein the trustee is the beneficiary but has strict and specific instructions to distribute the Trust funds for the benefit of the special needs individual as needed. If a special needs individual is not receiving public assistance, then the funds from a SNT can be used to pay for any needs of that individual.  However, if the special needs person is receiving public assistance, the funds can only be used for supplemental and extra care over what the government provides such as food and shelter. For example, funds from the Trust can be used for vacations, entertainment, or other activities or items that public benefits do not provide or cover. Accordingly, any funds the special needs individual receives from the Trust is not considered income for determining continued eligibility for government assistance such as SSI, subsidized housing, or MassHealth.

A special needs trust (SNT) that is properly established and funded is the main tool for assuring that your special needs family member continues to receive the resources he or she will need from public benefits as well as from your hard earned labor. Any funds that your special needs family member is receiving from SSI, will not be substantial and will barely meet expenses that are often considerable. Even for that special needs family member who qualifies for SSDI, and not receiving other benefits or assistance, the additional funds will enable them to enjoy life a little more.

Contact estate planning lawyer Patricia Bloom-McDonald for all your estate planning needs, but especially to discuss setting up a SNT for your special needs family member. Special needs planning has to be done properly with assurances of funding to keep the Trust vital. If you have any questions about how your special needs family member can be provided for in your estate, Attorney Bloom-McDonald will discuss your options with you.


Planning Your Estate Involving Art

Most people enjoy art and many have a special painting or sculpture in their homes. Those with substantial resources may have works of art that are considered quite valuable. In cases where there is an art collection, you may consider it as an asset with increasing value. Consequently, in estate planning, you will want to know about including these works of art in your estate and how they are to be bequeathed to your heirs along with the tax consequences.

The initial thing to do before naming beneficiaries to your art collection is determining if they even want the item. Not everyone is an aficionado of the arts and if they inherit a piece of art with some value, they may want to sell it immediately, or not appreciate the care such art may require. If they do wish to retain the art piece, it may require expensive preservation or a special insurance policy.

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What You Need to Know About Funding A Special Needs Trust  with Life Insurance

If you have a special needs family member, then you know that they often need services to help them with therapies, training, adaptive, and vocational skills, as well as daily living activities. In many instances, they live in group homes or have some type of assisted living arrangement. Of course, all of this can be expensive. And when you pass away, you will need to know that they are being properly cared for and with adequate funds. In such cases, a special needs trust (SNT) can be a valuable tool with which to help pay for things not covered by government programs.

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What Is a Death Doula and How Can One Help?

A doula is a nonmedical person who – in referring to the common use of the term – assists women during the birthing process. A death doula, which draws from the original meaning of “doula,” is a nonmedical person who helps a dying person and their family members. Also referred to as end-of-life doulas, death midwives, transition coaches, and soul midwives, death doulas can provide comfort when the end of life is near.

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