Florida Estate Planning Lawyer Blog
Many Jacksonville Special Needs Trust Lawyers and estate planning lawyers are rejoicing at the fact that the law concerning special needs trusts is about to change for the better. In Jacksonville, a special needs trust can be of the best tools available for many clients of Jacksonville Special Need Trust Lawyers because it gives a great number of benefits to those that suffer from a disability.
Congress and the president are on the verge of passing The Special Needs Trust Fairness Act. This act will allow a disabled person to create a special needs trust for himself (a First Person Special Needs Trust). Previously, the law did not permit a disabled person to form their own special needs trust.
Under the old law, the only way a person could receive a benefit of special needs trust was if he or she had a parent or grandparent, or court order to create the special needs trust. In Jacksonville, special needs trust lawyers had to jump through costly hoops for those clients without living parents or grandparents. The only way for these disabled persons to receive this trust is by giving another person guardianship rights or petitioning the court to create the trust.
This process made it unnecessarily difficult for people with few close relatives to receive this much-needed support. Further, it was a huge slap in the face to disabled persons because the previous law stated that a disabled person was not capable of creating a trust for themselves like other competent adults.
Is a First Party Special Needs Trust Still Limited to Individuals Younger than 65?
One question the estate planning attorneys at our firm often receive is whether or not first party special needs trust is still limited to individuals younger than 65 years old. The short answer is yes; this requirement will still be included in the new statute. For those over 65, the previous provisions still apply.
The statute that controls special needs trust is 42 USC 1396p(d)(4). The only change to the language of this statute are the words “the individual”. Here is a comparison of the old statute and the new statute.
OLD STATUTE, 42 USC 1396p(d)(4):
(4) This subsection [outlawing trusts for elders] shall not apply to any of the following trusts:
(A) A trust containing the assets of an individual under age 65 who is disabled (as defined in section 1614(a)(3)) and which is established for the benefit of such individual by a parent, grandparent, legal guardian of the individual, or a court if the State will receive all amounts remaining in the trust upon the death of such individual up to an amount equal to the total medical assistance paid on behalf of the individual under a State plan under this title.
NEW STATUTE:
(4) This subsection shall not apply to any of the following trusts:
(A) A trust containing the assets of an individual under age 65 who is disabled (as defined in section 1614(a)(3)) and which is established for the benefit of such individual by the individual, a parent, grandparent, legal guardian of the individual, or a court if the State will receive all amounts remaining in the trust upon the death of such individual up to an amount equal to the total medical assistance paid on behalf of the individual under a State plan under this title.
So as this language shows, no other changes will be made to the statute besides the change that allows disabled persons to create a special needs trust.
The Benefits of a Special Needs Trust in Jacksonville
A special needs trust allows friends, family members and loved ones to contribute to a disabled person’s healthcare without disqualifying the person from certain government programs. Florida is a state that sets financial boundaries on Medicaid for Florida residents.
This means that if a person makes over a certain income or owns too many assets, then this person cannot qualify for Medicaid. Medicaid is a great program because it provides long-term health care to those in need. A special needs trust works with Medicaid to ensure that a disabled person has as much help as possible. If friends and family members give money to a disabled person directly, it could disqualify the recipient from crucial government assistance.
For more information on special needs trusts contact The Jacksonville Special Needs Trust Lawyers at The Law Office of David M. Goldman PLLC.