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ESTATE PLANNINGFOR FAMILIES

WITH PERSONSWITH DISABILITIES

© Paul A. Nidich, J.D., LL.M.Suite 365

4555 Lake Forest DriveCincinnati, Ohio 45242

513.563.1595http:/www.specialneedslawyer.biz

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THE PRIMARY CONCERN OF FAMILIES WITH MEMBERS WHO HAVE DISABILITIES:

“What will happen to our _________

when we’re gone?

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THE ANSWER

SUPPLEMENTAL NEEDS PLANNING

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SUPPLEMENTAL NEEDS PLANNING –

PURPOSE: To answer the question “What will happen when we’re gone?” with a well-thought out plan!

and

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To ensure the availability of governmental resources to maximize the quality of life of the individual with disabilities.

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PRELIMINARY QUESTIONS TO DETERMINE THE TYPE

OF ESTATE PLAN WHICH IS MOST APPROPRIATE FOR

YOUR SITUATION

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PRELIMINARY PLANNING QUESTION - I

Will the person with disabilities likely be able to earn enough money to support himself or herself?

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ACTION:

If the individual is likely to be able to support

him/herself, government benefits may be limited. A “typical” estate plan

may be all that is needed.

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ACTION:

Planned Lifetime Assistance Network of Southwest Ohio,

(PLAN), provides supplemental services to individuals with disabilities. With or without

receiving government benefits, this may be an appropriate

choice to obtain needed services. CALL 821.6111.

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PRELIMINARY PLANNING QUESTION - II

If it is unlikely that the person with disabilities

will be able to earn enough money to support himself or

herself . . .

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ACTION:

CREATE A SUPPLEMENTAL NEEDS TRUST

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WHY?

To qualify for or continueto qualify for

governmental benefits.

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GOVERNMENT BENEFITS

Supplemental Security Income (SSI)

MedicaidAdult Disabled Children Program (DAC)

Medicare

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Food stampsCase ManagementHousingEmployment Support

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TRUST PLANNING

Living TrustDiscretionary Trust Drafted Supplemental Needs

TrustStatutory Supplemental Needs

Trust Pooled Trust “Sibling” Trusts

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LIVING TRUST

A Living Trust is used primarily as a means to

minimize the involvement of probate. Trusts are not just

for people trying to avoid estate taxes. While most

people don’t need to do estate tax planning, everyone can

benefit from probate planning.

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DISCRETIONARY TRUST

A Discretionary Trust is often used as an intermediate step to shield unnecessary money

from flowing into the supplemental needs trust.

This is designed to meet two goals:

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DISCRETIONARY TRUST

1) It keeps too much money from going into the supplemental needs trust at one time, and

2) If the supplemental needs trust laws or regulations change, it minimizes the amount of money at risk to be paid back to the government.

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SUPPLEMENTAL NEEDS TRUST (DRAFTED)

This is the primary recipient of funds to provide the

supplemental services for the person with disabilities. It should be funded sparingly

(see previous slide, #2).

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SUPPLEMENTAL NEEDS TRUST (STATUTORY)

While the statutory supplemental needs trust might fit some situations,

it does have some negatives. The amount

of money that

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SUPPLEMENTAL NEEDS TRUST (STATUTORY)

can be put into such a trust is limited by state law,

and when the trust is no longer in existence, up to

half of the value of the trust MUST be paid to the

state.

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“SIBLING TRUST”

A “Sibling Trust” is designed to provide maximum

flexibility in moving money to family members who don’t have disabilities. It also serves as the residuary

beneficiary of the supplemental needs trust.

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INTERVIEW THE PROSPECTIVE ATTORNEY

Most attorneys, even those who regularly draft estate plans,

don’t know the basics of supplemental needs planning.

Meet with the attorney and interview him or her. Any

attorney worth hiring will NOT be offended.

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INTERVIEW THE PROSPECTIVE ATTORNEY

Find out, for example, how long the attorney has been involved in supplemental needs trust planning. Ask

why the attorney does supplemental needs

planning.

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INTERVIEW THE PROSPECTIVE ATTORNEY

Ask the attorney to explain the difference between the

statutory supplemental needs trust and other kinds

of supplemental needs trusts.

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INTERVIEW THE PROSPECTIVE ATTORNEY

If you don’t get satisfactory

answers; if the “chemistry” isn’t right; or if the attorney only uses the statutory supplemental needs trust in every situation, don’t hire

that attorney, even if you may ultimately choose a statutory

trust.

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MY SUPPLEMENTAL NEEDS TRUST “PACKAGE”

Wills for Husband and WifeFinancial Powers of

Attorney for Husband and Wife

Health Care Advanced Directives for Husband and Wife

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MY SUPPLEMENTAL NEEDS TRUST “PACKAGE”

Revocable Living TrustIrrevocable Supplemental Needs Trust

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DIAGRAM OF TRUST PLAN I TYPICALLY USE

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WHAT DOES THIS COST?

The average cost for this kind of estate

plan in the Cincinnati area is probably

$2,500 to $3,500.

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WHAT DOES THIS COST?

Because my son has autism, and I know just how important this is for

families with special needs members, I currently

charge $1,250 no matter how many meetings it takes to draft the plan.

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WHAT DOES THIS COST?

However, because of the rising costs of

everything, I probably will be increasing my

fee to $1,500 after the first of the year.

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WHAT DOES THIS COST?

Perhaps this will give you an added incentive to

get this extremely important planning done,

if you would like me to prepare your plan.

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THANK YOU FOR YOUR TIME!

©Paul A. Nidich, J.D., LL.M. (Taxation)4555 Lake Forest Drive

Suite 365Cincinnati, OH 45242

513.563.1595http://www.specialneedslawyer.biz