How About Doing Someone Else’s Planning?

When planning your estate, considering your personal long-term needs is an essential part of the process.  Determining whether you may qualify Medi-Cal benefits or VA benefits in the future helps to ensure financial stability if you have some long-term health issues.  In order to effectively plan to qualify for these benefits, you may make a QMap Trust or QVap Trust.  Additionally, you might consider whether long-term care insurance will be wise for you or how your Financial Power of Attorney and Advance Healthcare Directive ought to be used.  However, when you are responsible for someone else, it is important to consider their long-term care.

Frequently, this issue is important when you have adult children with disabilities.  The more severe their disability, the less likely they will be to have and maintain gainful, full-time employment.  As a result, state and federal safety-net programs often provide a reasonable quality of life.  Without these programs, the person who suffers from the disability would be unable to support himself for long.  When making your own estate plan, the reality that one of your beneficiaries receives need-based assistance changes the dynamics of your typical estate plan.

If you wish to leave assets to the person who has a disability, you must carefully consider your options so that the entire inheritance does not go to repay the programs or disqualify the beneficiary from various programs.  When planning to leave assets to someone who receives benefits from Medi-Cal, Social Security, HUD, and other welfare programs, your attorney must be aware of the qualifications rules for the specific types of programs you wish to protect in order to properly advise you how to construct your plan.  Depending on the amounts you wish to give, certain plans may be more appropriate than others.

Among the most common methods for preserving an inheritance for a person with disabilities is the Special Needs Trust (SNT).  An SNT may be a stand-alone trust or may be part of your regular revocable living trust.  There are advantages to a stand-alone trust if, for example, more than one person may contribute to the assets held in trust.  Alternatively, leaving the SNT in your revocable living trust may be more cost effective and simpler for you to review and amend over time.  SNTs are very limited in the types of expenses that may be paid and how they are paid.

If you are leaving a small amount of money, you may instead wish to leave the bequest to another individual to use for the benefit of the person with the disability.  It may be possible for you to direct that larger sums be used to purchase an exempt asset, such as a personal residence.  These alternative strategies may relieve a person from having to act as trustee for an extended period of time and free your assets from the ongoing expenses of trust administration, such as trustee fees, tax returns, accounting, and legal fees.  However, assets held outside of trust, particularly when given to a specific person, may be more difficult to control and protect.

Just as it is important for you to plan for your own eligibility for public benefits, it is important to ensure that beneficiaries receiving public benefits are able to maintain them, while still enjoying some of the benefits of their inheritance!

VA Aid & Attendance–How Can I Correctly Choose Help for my Application Process?  FREE REPORT:  This complimentary report focuses on the various kinds of people one can consult when applying for the Veterans Aid & Attendance benefit. Who one chooses can mean the difference between success and failure. Remember, if you are denied, you may not be able to reapply for up to a year or longer. Download our complimentary report for a behind the scenes look at the different types of people you can consult and the dirty underbelly of the Veterans Aid & Attendance industry.