SUNCOA ST ESTAT E P LA NNING COUNCILOCT OBER 15 , 2009

M A RY A LICE J A CK SON, ESQ.M A J A CK SON @B OYERJ A CK SON.COM

W W W.B OYERJ A CK SON.COM

STEP BY STEP: SNTS AND ESTATE PLANNING

STEP 1 – THE BASIC ANALYSIS

Is there a client or beneficiary who is receiving public benefits, who might qualify for public benefits in the future or who could benefit from the programs now? SSI SSDI Medicaid Medicare

If no, grab some more breakfast and turn on your iphones….

STEP 2 – EXISTING ESTATE PLANS

Outright distributions will cause a loss of means tested public benefits

Mandatory income distributions may cause a loss of means tested public benefits

Discretionary trust language can be used to protect benefits

These discretionary trusts are “third party” special needs trusts

NOTE: ELIGIBILITY REQUIREMENTS FOR SSI, MEDICAID, HUD HOUSING, ETC. ARE ALWAYS THE SAME

TERMS OF THE BEQUEST ARE THE KEY

STEP 3 – BEGINNING THE PLANNING

Must ask about disability status of any potential beneficiary

SNT can be created within a LWT , Rev Trust or Irrev Trust

Keys to drafting: No mandatory distributions Spendthrift clauses No ability for beneficiary to revoke, terminate or compel

STEP 4 – THE DETAILS

Trustee must be able to understand program regulations

Beneficiary designations: “to the trustee of the Bobby Bowden Special Needs

Trust dated October 15, 2009” Applies to all assets that will be used to fund the trust Pay directly to the SNT trustee even if SNT created

under Will Insurance, annuities, IRAs** **Third party IRAs can be designated into SNT but 1st

party IRAs cannot under current IRS regs

STEP 5 – STAND ALONE 3D PARTIES

For current funding Differing parties want to fund trust Tax planning potential Long term care planning needs

STEP 6 – SPOUSAL PROTECTION

Sec. 732.4045, Fla. Stat.“Qualifying Special Needs Trusts”

Why? When? Issues

Is failure to create a QSNT malpractice?