Tools for Parents of Children With Special Needs

Parents want their children to be taken care of after they die. But children with disabilities have increased financial and care needs, so ensuring their long-term welfare can be tricky. Proper planning by parents is necessary to benefit the child with a disability, including an adult child, as well as assist any siblings who may be left with the caretaking responsibility.

Special Needs Trusts

The most comprehensive option to protect a loved one is to set up a special needs trust (also called a supplemental needs trust). These trusts allow beneficiaries to receive inheritances, gifts, lawsuit settlements, or other funds and yet not lose their eligibility for certain government programs, such as Medicaid and Supplemental Security Income (SSI). The trusts are drafted so that the funds will not be considered to belong to the beneficiaries in determining their eligibility for public benefits.

There are three main types of special needs trusts:

  • A first-party trust is designed to hold a beneficiary’s own assets. While the beneficiary is living, the funds in the trust are used for the beneficiary’s benefit, and when the beneficiary dies, any assets remaining in the trust are used to reimburse the government for the cost of medical care. These trusts are especially useful for beneficiaries who are receiving Medicaid, SSI or other needs-based benefits and come into large amounts of money, because the trust allows the beneficiaries to retain their benefits while still being able to use their own funds when necessary.
  • The third-party special needs trust is most often used by parents and other family members to assist a person with special needs. These trusts can hold any kind of asset imaginable belonging to the family member or other individual, including a house, stocks and bonds, and other types of investments. The third-party trust functions like a first-party special needs trust in that the assets held in the trust do not affect a beneficiary’s access to benefits and the funds can be used to pay for the beneficiary’s supplemental needs beyond those covered by government benefits. But a third-party special needs trust does not contain the “payback” provision found in first-party trusts. This means that when the beneficiary with special needs dies, any funds remaining in the trust can pass to other family members, or to charity, without having to be used to reimburse the government.
  • A pooled trust is an alternative to the first-party special needs trust.  Essentially, a charity sets up these trusts that allow beneficiaries to pool their resources with those of other trust beneficiaries for investment purposes, while still maintaining separate accounts for each beneficiary’s needs. When the beneficiary dies, the funds remaining in the account reimburse the government for care, but a portion also goes towards the non-profit organization responsible for managing the trust.

Life Insurance

Not everyone has a large chunk of money that can be left to a special needs trust, so life insurance can be an essential tool. If you’ve established a special needs trust, a life insurance policy can pay directly into it, and it does not have to go through probate or be subject to estate tax. Be sure to review the beneficiary designation to make sure it names the trust, not the child. You should make sure you have enough insurance to pay for your child’s care long after you are gone. Without proper funding, the burden of care may fall on siblings or other family members. Using a life insurance policy will also guarantee future funding for the trust while keeping the parents’ estate intact for other family members. When looking for life insurance, consider a second-to-die policy. This type of policy only pays out after the second parent dies, and it has the benefit of lower premiums than regular life insurance policies.

ABLE Account

An Achieving a Better Life Experience (ABLE) account allows people with disabilities who became disabled before they turned 26 to set aside up to $15,000 a year in tax-free savings accounts without affecting their eligibility for government benefits. This money can come from the individual with the disability or anyone else who may wish to give him money.

Created by Congress in 2014 and modeled on 529 savings plans for higher education, these accounts can be used to pay for qualifying expenses of the account beneficiary, such as the costs of treating the disability or for education, housing and health care, among other things. ABLE account programs have been rolling out on a state-by-state basis, but even if your state does not yet have its own program, many state programs allow out-of-state beneficiaries to open accounts.

Although it may be easy to set up an ABLE account, there are many hidden pitfalls associated with spending the funds in the accounts, both for the beneficiary and for her family members. In addition, ABLE accounts cannot hold more than $100,000 without jeopardizing government benefits like Medicaid and SSI. If there are funds remaining in an ABLE account upon the death of the account beneficiary, they must be first used to reimburse the government for Medicaid benefits received by the beneficiary, and then the remaining funds will have to pass through probate in order to be transferred to the beneficiary’s heirs.

Get Help With Your Plan

However you decide to provide for a child with special needs, proper planning is essential. We can help!

This article is a service of Myrna Serrano Setty, Esq. Myrna doesn’t just draft documents. We help you ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Planning Session, during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. Call our office today to schedule a  Planning Session and mention this article to find out how to get this $500 session at no charge.

 

Estate Planning Must-Haves for Unmarried Couples – Part 1

Appoint a Guardian to Keep Your Kids In Safe Hands At All Times

 

Every parent who’s watched the news lately has felt the heartbreak over what’s happening to immigrant families at the border. Between May and June 2018, more than 2,300 kids have been separated from their parents at the U.S.-Mexico border.

Think of the horror of kids crying and begging for their parents. What would it be like for your own kids to be taken into the custody of strangers?

Let this be the moment that you place your own fears aside and take a look at the privilege you have of being able to make choices on behalf of your kids to ensure their well-being and care by the people you want, no matter what happens.

It can happen to your family.

Even though most people think that something like that could never happen to their family, they’re totally wrong. While your kids almost certainly won’t be taken into custody by U.S. border agents, your kids could be taken into the care of strangers if something happens to you—even if your family or friends are on the scene.

But you can do something to protect your kids and ensure they’re always in the care of people you know, love, and trust. Take action on behalf of your own kids—instead of merely feeling numbness and paralysis over not knowing what to do—these events can inspire you to do the things you know you must in order to properly take care of your family.

Understand the risk.

While it may seem like a long shot, the consequences are serious enough that you must consider the real possibility of what could happen and ensure you’ve taken right actions to protect your loved ones. Let’s say you and your spouse have gone out to dinner together and left the kids with a babysitter. But on the way home, you’re in a car accident. The police will get to your house, find your kids home with a babysitter, and have no choice but to take your kids into the care of the authorities (strangers) until they can figure out what to do.

This is the case even if you have friends or family living nearby. If you haven’t left proper legal documentation, the authorities have no option but to call child protective services—that is, unless you’ve legally given them an alternative. This is true, for example, even if you have named godparents. You must give the authorities a legal basis for keeping your kids with the close friends or family you designate.

Without your action, when the babysitter answers the door, she’s in complete shock and willing to stay with your kids while the authorities find a relative to take them. Unfortunately, she doesn’t have the legal authority to care for the kids—even temporarily—so the police have no choice but to call child protective services. These authorities will take your kids into custody until they can locate and/or appoint the proper guardian.

Maybe you have plenty of family who’d want to take custody of your kids if something were to happen to you. Maybe some of them even live close by, so the authorities could easily find them. Maybe more than one family member would want to take custody of your kids (and the financial resources you’re leaving behind for them).

We’ve seen what happens when well-meaning family members—who think they’d be the best choice as caretaker for their young relatives—go to battle in the name of love. It isn’t pretty. In such a situation, it takes years of legal fighting, making lawyers wealthy, while the kids are stuck in the middle. In almost every case, each side fighting for the care of the kids feels certain they’re doing what the parents would’ve wanted and what’s best for the kids.

Know your options and your responsibility.

The sad thing is, this all can be completely (and very easily) prevented. However, to ensure your kids are never taken into the care of strangers—or put in the middle of a family conflict—you must take action now. Please do not leave this to chance. You have the privilege to be able to guarantee that your kids are never taken into the care of strangers—or into the care of anyone you would not choose—but you must take action now to exercise that privilege.

Maybe you think this could never happen to your family because your family would never fight over your kids or because you’ve named close friends as godparents. But why take that risk, when it’s so easy to do the right thing by the people you love more than anything?

And if you think you’ve already done the right thing because you have a will that names legal guardians for your kids, think again. We’ve found that in most cases, even parents who worked with a lawyer to name legal guardians have made at least one of six common mistakes that leave their kids at risk.

These mistakes are made because unfortunately, most lawyers do not know what’s necessary for planning and ensuring the well-being and care of minor kids.

Attorney Myrna Serrano Setty has been trained on legal planning for the unique needs of families with minor kids at home. If you’ve already created a will, Myrna can help you identify whether you’ve made any of the six common mistakes that could leave your kids at risk. If you have not yet taken any action, Myrna can help you take the first steps and make the very best decisions for the people you love.

Here’s how to get started.
Call us at (813) 514-2946 to book a comprehensive Planning Session.

You might think that such a thing could never happen to your family, but in these scary times, you can never be too safe.

This article is a service of attorney Myrna Serrano Setty. Myrna doesn’t just draft documents, she helps you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why Myrna’s firm offers a Planning Session, during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by calling our office today to schedule a Planning Session and mention this article to find out how to get this $500 session for free.

Talking to Your Kids About School Violence

 

 

 

 

On February 14, 2018, there was another mass shooting at a school, this time in Parkland, Florida. Our thoughts and prayers are with the families devastated by this tragedy. As we struggle to cope with this tragedy, we need to figure out how to talk about this with our kids. Parents can help their kids feel safe (or safer) by establishing a sense of normalcy and security and by talking to them about their fears. At some point, our kids are going to learn about what happened, and we need to be prepared to talk about it.

How do we do that? Here are some tips:

1.     Observe your child’s emotional state. Sometimes it takes a while for anxiety and depression to manifest itself. You know your child better than anyone. And don’t be afraid to seek professional help. 

2.     Make time to talk. Let your child’s questions guide you in how much information to provide. Sometimes it takes a while for them to express their feelings.

3.     Validate their feelings. Let them talk about their fears.

4.     Keep your explanations developmentally appropriate. For example, kids in early elementary need brief, simple information balanced with assurance that school personnel are there to protect them. Give simple reminders of school safety, like reminding them about school safety drills and locked doors.

5.     Review safety procedures at home and at school. This is a good chance to also review your family’s emergency procedures. For example, if something happened to you, who would the school contact? Who would have the legal authority to take care of your kids? What happens if you don’t live near family?

6.     Limit television viewing. We live in an era of the 24-hour news cycle. This can be overwhelming, even for adults.

7.     Explain that there’s a difference between reporting, tattling and gossiping. Encourage kids to talk to a trusted adult if they see or hear about something that may harm others.

8.     Explain that while there is no absolute guarantee that nothing bad will ever happen, you will try your best to keep them safe because you love them more than anything in this world.

This article is a service of attorney Myrna Serrano Setty, who does more than just draft documents. She guides families through difficult topics, like estate planning, so they can protect what matters most. Myrna may be reached at (813) 514-2946 and info@www.tampaestateplan.com.

Families, don’t put off your estate planning any longer.

What would happen to your kids if something happened to you? This story will break your heart.

On a summer vacation in 2006, Casey and Melanie Barber took a road trip with their three boys, ages 3, 5 and 8. A tire defect caused a blow out and there was a horrific accident that left both parents dead. Miraculously, all three boys survived.

The Barbers had never legally documented who they wished to be guardian for their children. In the aftermath of the accident, through the grief and confusion, there was a contentious court battle over the boys and their inheritance. Multiple family members came forward claiming they were best suited to care for the three boys. Not only was the well being of the boys a stake, so was their inheritance, and ultimately the proceeds from a wrongful death lawsuit (a jury ultimately awarded $14.4 million). Things got so ugly that at one point the boys ended up in foster care. The court battle lasted over a year, involved at least nine lawyers and cost thousands and thousands of dollars.

Ultimately, the court did appoint a guardian to raise the boys. Was it who Casey and Melanie would have chosen to raise their boys? We’ll never know because Casey and Melanie never documented their wishes.

It doesn’t have to be that way for your family.

Like many parents with young kids at home, the Barbers didn’t put a plan together that would have protected their children from that ugly court battle.  Many of us parents have so many questions about estate planning and feel so overwhelmed at the thought of someone else raising our kids, that we procrastinate. We’re so busy taking care of our kids, working to make a living, and spending quality family time, that we may feel like we can’t afford to spend any extra time or money on ourselves, let alone for estate planning.

I know how that feels. I’m a mom of 2 little girls. My husband and I both have demanding jobs. Every day, we have to figure out kid pick-up and drop off at different schools, what chores need to be done…on top of stuff like soccer practice, piano lessons, and the occasional date night.

The most important thing that any parent can do is name a guardian for their kids. Most people don’t realize that if the parents don’t name a guardian to raise your kids if something happens to you, the court will do that for you. And it may not be who you would have wanted.

Parents need to speak to a good estate planning attorney who understands the needs of young families. That attorney needs to be able to offer advice for how to best provide for your children and design a customized plan that meets your needs.

Estate planning doesn’t have to be hard or intimidating. We need to make time for this. Our kids are worth it. Call Myrna today at (813) 514-2946 for an appointment.

Holidays and Estate Planning: A Winning Combination

The Holidays are the best time to discuss important family estate plans with your aging parents.

Hang in there with me. I’m sure some of you are thinking, “You’ve got to be kidding me!”

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It’s a winning combination: many of us take a break from work and we’ve carved out time to see our siblings, our parents and extended family. Estate planning is about helping our families navigate some of life’s toughest transitions, not just about death. Learn how to make the most of your opportunity this time of year to talk about things that will have lasting benefits.

Here are some tips:

  1. Treat this as a family meeting. Ban cell phones from the room, get someone to watch the kids and make sure any stragglers are included through a conference call or video conference.
  2. Start with the basics and work your way up. With aging parents, ask about their health and if they need help talking to the doctor or pharmacist.  How do they feel about driving?
  3. Ask them where they store their important documents? Their Will, Power of Attorney, life insurance, birth certificates, etc? Is there an inventory of personal information and financial records?
  4. Who will serve as the financial backup person to the parents? Will it be one of the children, or a trusted third party?
  5. Check in with your parents emotional well being. Are you visiting enough? How can you incorporate technology to stay close? For example, FaceTime or video chat?

These tips will help you and your siblings understand where your parents are in terms of estate planning, and what kind of help they, and you, need.

Blended Families, Avoid This $100,000 Mistake.

Picture this: At Thanksgiving, you have your eye on that last piece of pie. You can practically taste it. As you reach for it, someone else grabs it and there’s a tug of war. Do you share it? Does one of you give up and find another dessert? Does someone intervene and decide for you? Are you in a family that will laugh this off? Or is there some drama?

When the stakes are high and there’s money and property involved, the resulting conflict is enough to ruin anyone’s appetite.

Picture this: You’re in a blended family where there’s Mom, Step-Dad, and Mom’s kids from her first marriage. Mom dies without a Will. Step-Dad is distraught, but takes comfort in knowing that the house is almost paid off. There’s about $200,000 of equity. Mom always meant to put Step-Dad on the deed, but never got around to it. Unfortunately for Step-Dad, the “default setting” that is set by Florida law is for him to only inherit half of his wife’s estate. The step-kids inherit the other half.

Step-Dad has 3 options if he wants to keep living in the home.

Option 1: Take a life estate in the home and at his death, the house goes to the step-kids.
Option 2: Take a one half undivided interest in the home as a tenant in common with the step-kids. (The step-kids could force a sale if they wanted to.)
Option 3: Buy out the step-kids’ half share.

Everyone’s upset and relationships are strained. Will the step-kids sign over their interest to Step-Dad for free? Will it take $100,000 to buy out the step-kids? With a thoughtful estate plan, this blended family could have avoided this mess and saved $100,000, plus court costs and lawyers’ fees.

This article is a service of attorney Myrna Serrano Setty. Myrna doesn’t just draft documents. She can help you make informed and empowered decisions about life and death, for yourself and your loved ones. That’s why she offers a Life and Legacy Planning Session, during which you will get more financially organized than you’ve ever been before, and make the best choices for the people you love. You can begin by calling Myrna’s office today at (813) 514-2946 to schedule a Planning Session and mention this article to find out how to get this $500 session at no charge.

When Duty Calls: Navigating the Sandwich Generation with Ease

The average age of parents raising children in the US continues to rise, leaving many middle-aged Americans in a category commonly referred to as the “sandwich” generation.

This growing population of adults are often still raising kids at home when they become responsible for the care of their own aging parents. The stress and financial strain of managing taking care of both your children and your parents can become overwhelming. The following tips can help make this challenging life stage easier to manage, and more enjoyable for everyone.

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Assess the Financial Situation

Taking time to thoroughly understand the complete financial picture of your home is important when you step into a role of responsibility for your aging parent. You can prepare for all possibilities, and avoid surprises, by working with a professional to consider how your role in the care of your parent will affect the plans you are making for your family’s financial future. Take advantage of our Life and Legacy Planning Sessions, a comprehensive planning process encompassing your concerns and needs.

Plan Ahead

Benjamin Franklin is quoted as saying that, “Failing to plan is planning to fail.” Planning for your family’s future means preparing for the worst and hoping for the best. As you navigate helping your aging parent with their own important Estate Planning decisions, take time to make sure your own estate wishes are taken care of too, so that you can focus on the present knowing the future is taken care of.

Be sure to include:

  • Medical power of attorney – appoints a person to make medical decisions if you are unable to do so
  • Durable power of attorney – designates a person to make financial decisions if you are unable to do so
  • Living will – expresses your wishes for end of life decisions
  • Will – carries out your wishes in the event of your death
  • Kids Protection Plan – designates a legal guardian for your minor children in the event of your incapacitation or death

Pay Attention to Red Flags

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Even if your aging parent is still quite capable, work together to get a handle on their financial situation, and be on the lookout for signs that anything is falling through the cracks. Common red flags are:

  • Frequent calls from creditors
  • Forgetfulness when it comes to bills and deadlines
  • Unopened mail

Utilize professional legal and financial support when necessary and communicate clearly so everyone knows who is responsible for what.

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Practice Good Self Care

Stress is one of the most common consequences of caring for two generations at once. Balancing the responsibilities of raising children and caring for aging parents with good self-care and “me time” is vital over the long-haul. Remember that adequate rest and good nutrition will provide you with the extra energy you’ll need when times get tough. Most importantly, remember that you don’t have to do it alone! As your attorney, I am ready to assist you when duty calls.

Now is the perfect time to schedule a Life and Legacy Planning Session, where we’ll review your current financial situation in light of your future responsibilities. With our assistance, you’ll gain the confidence of knowing you’re making the most empowered, informed and educated legal and financial decisions for yourself and the ones you love.

The Pitfalls of DIY Wills: Buyer Beware

More than ever, DIY wills are becoming more common. It’s understandable that with resources like Google, many of us are turning to the internet for information and resources. However, many people don’t realize how risky it is to create DIY legal documents because simply put, we don’t know what we don’t know. Here’s what you need to know before you decide to create your own will or use an online service.

While online companies are making legal services more accessible, they’re also doing their customers a disservice, as evidenced in the recent case of In re Estate of Aldrich, heard in a Florida appeals court. Ms. Aldrich created her will using a downloaded template from E-Z Legal Forms without the advice and guidance of an estate lawyer. It appears, based on the forms she created herself, that she wished to leave specific assets to her sister, and then to her brother if her sister died before her. Her sister did die, but Ms.Aldrich, not realizing this would affect her own assets someday, did not properly update her will.

The assets specifically named in the will went to Ms. Aldrich’s brother, but the template she used did not include a residuary clause, which establishes where unnamed assets should go. As a result, the unnamed assets Ms. Aldrich acquired after she created her will passed under Florida’s intestacy laws and into the hands of her nieces, children of another pre-deceased sibling, instead of to her brother, as she seemed to have wanted.

Unfortunately, because she did not consult a lawyer, instead of leaving her brother her assets, Ms. Aldrich left him with a long, expensive, and otherwise unnecessary court battle. Services like E-Z Legal Forms do not provide personal legal advice or ongoing legal support. Had Ms. Aldrich worked with an estate lawyer to design and then update her plans, she would have left her brother an inheritance of love, rather than a nightmare of time, money and heartache.

This is an important lesson to learn because people too often create their will without having a lawyer review it and then forget to update it as loved ones pass on and new assets are acquired. In the end, their wishes aren’t honored because they weren’t clearly defined, leaving the matter in the hands of the probate court.

This article is a service of attorney Myrna Serrano Setty. Myrna doesn’t just draft documents, she helps folks make informed and empowered decisions about their life and death, for their sake and their loved ones. That’s why Myrna offers a Life and Legacy Planning Session, during which you’ll get more financially organized than you’ve ever been before, and make the best choices for the people you love. You can begin by calling her office today at (813) 514-2946 to schedule a Life and Legacy Planning Session and mention this article to find out how to get this $500 session at no charge. 

How to Protect Family Heirlooms From a Family Feud

The passing of family heirlooms from one generation to another should be a welcome and sacred tradition for families. Unfortunately, this process, if not done carefully, can cause long-lasting family rifts.

There are many stories of families that have split over a silver tea set, or family photo albums. In fact, you may be surprised to discover that far more family conflicts occur over cherished family mementos instead of money. If you don’t want that to happen in your family, here’s what you can do as part of your estate planning:

1. Add specific designations to your Will and/or Trust.

Typically, a Will or Trust will specify that all personal property goes to the “residue” and is split equally between all heirs. But you may want to get more specific with items that are already family heirlooms or that you want to become family heirlooms. All too often children will discover after Mom or Dad has passed that an item was promised to more than one person. This is why it is important to create a list of your family heirlooms, assign names to each item and share that list during a family gathering while you’re still alive and well. This list (formally called a personal property memorandum) can then be incorporated into your will or trust, so it becomes legally binding. It is also wise to take photos of those special items to help identify them.

2. Make it fun.

Indicate in your Will and/or Trust that you want your family to make it a game and “auction off” your special items.  Each family member can be given “credits” to use to “bid” on the items they want. Or you could suggest that items be chosen round-robin style with each family  member getting to make one choice (starting with youngest or oldest, as designated by you) before going back around for family member’s to make their second choice. Then, after all the picking is done, family members can trade amongst themselves.

3. Give it away during life.

One of the best ways to ensure your family doesn’t fight after you are gone is to give away family heirlooms during your lifetime. By doing this, you can create even more connection with the people you love.

4. Leave a recorded legacy.

We’ve found the best way to pass on more than just your money is to record a story associated with each one of your family heirlooms. Include where the heirloom came from, who you are passing it onto and the special significance it has to you.  This recording is likely to become the most valuable asset you can leave behind.

One of the main objectives of our law practice is to keep families out of court and out of conflict through thoughtful estate planning. This article is a service of attorney Myrna Serrano Setty. Myrna doesn’t just draft documents, she helps folks make informed and empowered decisions about their life and death, for their sake and their loved ones. That’s why Myrna offers a Life and Legacy Planning Session, during which you’ll get more financially organized than you’ve ever been before, and make the best choices for the people you love. You can begin by calling her office today at (813) 514-2946 to schedule a Life and Legacy Planning Session and mention this article to find out how to get this $500 session at no charge.