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Special Needs Trust Fairness Gives Disabled Long Overdue Rights


Special Needs Trust Fairness Gives Disabled Long Overdue Rights

Two words were all that were missing from the Special Needs Trust Fairness Act of 2015, but they were enough to create a legal challenge for disabled individuals. When President Obama signed the 21st Century Cures Act in mid-December, the addition of the two words—“the individual—changed the existing statute and gave disabled individuals an important power.

In “Special Needs Trust Fairness Act Becomes Law, says that more than 20 years of unfair treatment to individuals with disabilities now has ended by permitting those with the capacity to create their own self-settled special needs trust (SNT) to do so without requiring them to go to court. Before this new law was enacted, individuals with disabilities who didn’t have a living parent or grandparent couldn’t create their own self-settled SNT without a court hearing.

You should still speak with an experienced special needs planning attorney about drafting an appropriate self-settled SNT. The 21st Century Cures Act allows capable individuals with disabilities, to independently make their own decisions. They’re not forced to go to court to establish a SNT, in the absence of living parents or grandparents.

The 21st Century Cures Act finally amends Section 1917(d)(4)(A) of the Social Security Act (42 U.S.C. 1396p(d)(4)(A)) by inserting “the individual,” after “for the benefit of such individual by.” This new law is effective for trusts established on or after December 13, 2016. However, some states may want to try to hold off and pass their own state statutes.

One reminder: self-settled special needs trusts shouldn’t be confused with third-party special needs trusts. Those trusts are funded with assets from family members or other sources, rather than with the individual with disability’s own assets. Third party SNTs are a common estate-planning tool used to improve the quality of life of the individual with disabilities.

The assets held by third-party SNTs are not required to be used to repay the Medicaid program for the cost of care provided to the individual with disabilities. Rather, the assets in a third-part special needs trust can pass to other family members on the death of the individual with disabilities.

To ensure that any SNT works well as part of an overall estate plan, meet with an estate planning attorney who is familiar with SNTs.

Do you live in Miami-Dade, Broward, or Palm Beach counties in Florida? Laws are constantly changing-- has your estate plan been reviewed in the last 2-3 years? Call me (954-888-1747) right away for peace of mind. I can help!

  • My practice is exclusively estate planning and probate,
  • I have prepared numerous estate plans in 16 years of practice,
  • I have administered estates and trusts through Probate all over Florida,
  • I am a Certified Financial Planner Professional™, and
  • I am here for YOU today and there for your FAMILY tomorrow.

Reference: (December 16, 2016) “Special Needs Trust Fairness Act Becomes Law

Why would we recommend D.T.F.? Several Reasons: Your ability to explain complex estate problems, clearly and patiently; your total lack of arrogance and pretense; a strong feeling that you are motivated by what you perceive is best for your client, rather than what would generate the largest legal fees; finally, and importantly, you are a lovely guy. A.C.

Two words cannot sum up the entire process of creating my “trust.” I enjoyed your attention to detail, your patience of explaining terms and conditions until I understood, also giving me copies to read and understand. Thank you for your suggestions on what was best for “me” but still allowing me to make my choice. Most of all, thank you for thinking of “me.” Wells Fargo said “you were the best” I cannot deny that. Again thank you very much for everything. Anna is an asset or a compliment to the firm. She is warm and very caring. It was great doing business. Thank you.