Considerations When Giving Holiday Gifts To Special Needs Loved Ones

At this time of year many people think about giving gifts to the young people in their life. If the recipient has special needs and receives federal aid such as Medicaid or SSI, or may apply for it in the future, you should give serious consideration to what and how you give.

Monetary Gifts
As a general rule, monetary gifts should not be made directly to your special needs loved one, in order to avoid jeopardizing his/her eligibility for vital government benefits. Giving a gift to someone with special needs is about more than being generous. It's about being generous the right way. Consider these gifts:


Contribute to a Special Needs Trust. Has a Special Needs Trust been created to benefit your loved one? If it is an irrevocable trust set up by a third party (usually a parent), there is no limit on the amount of funds it can hold. Those funds can be used by the trustee to pay for services the government does not provide, such as assistive technologies, transportation, etc.

Contribute to an ABLE account. Also find out if an ABLE account exists for your loved one. Up to $15,000 may be contributed to an ABLE account each year from all parties, so check with the account holder. 

Contribute to a Pooled Trust. If your loved one has funds for his benefit in a pooled trust, consider contributing to it. Pooled trusts combine funds from many beneficiaries while maintaining separate accounts for each beneficiary. As with the Special Needs Trust, there is no cap on the amount of money a pooled trust can hold.

Gifts for the child's support staff
Special needs children may have an array of people assisting them, from physical therapists to tutors to bus drivers. Cash may be an appropriate gift, but so is something small that shows you acknowledge and appreciate their efforts.

Toys

Obviously selecting appropriate toys for children with special needs will depend on their capabilities. What may help and engage one child may be meaningless or frustrating for another. Click here for guidelines on selecting disability-specific toys.

Turmoil in Aretha Franklin Estate: She Did Have A Will, After All - Three of Them

Our prior post of August 2018 is titled, Aretha Franklin, Queen of Soul, Dies Intestate. Now it turns out that the "intestate" part may not be true. Three handwritten wills were found in Franklin's suburban Detroit home recently. This development may well complicate matters, not clarify them.

The wills were discovered by the estate executor, Sabina Owens. Two were found in a locked cabinet. One dated March 2010 is 11 pages long. In it Franklin mentions the mass on her pancreas (she ultimately died of pancreatic cancer). The second will is dated June 2010. The third will, found scribbled in a spiral notebook and hidden under a couch cushion in the living room, is the most recent, dated March 2014. It is four pages long and particularly difficult to decipher, with multiple crossouts, additions, and notes in the margins. The provisions in the three wills have some similarities as well as differences.


Michigan recognizes handwritten (holographic) wills. The three documents have been turned over to the court, which will determine if any of the wills is valid and can be admitted to probate. According to Franklin's longtime entertainment attorney, David Wilson, all the wills appear to be in his client's handwriting. But that alone is not sufficient to prove a will's authenticity and validity; it must meet additional legal requirements. A hearing on the matter is set for June 12.


If none of the wills is deemed valid, Franklin’s estate will remain as it was - intestate - and her assets will be divided equally among her four sons. Some sons will be winners and other losers, depending on how this all plays out. The situation is likely to fuel the family division that is simmering. Six days after discovering the wills, Owens provided copies to Franklin’s children. Already, two sons have challenged their validity. One son, Kecalf, has said that because the 2014 will names him executor, he should replace Owens. He also objects to the sale of a piece of land that that document leaves to him.

 
Although all the wills specify that the sons are to share equally in their mother's music royalties and the proceeds from her memorabilia, she gives special attention to Clarence, her eldest son with special needs. She prohibits his father, who did not participate in his upbringing, from handling money or property for him. She also leaves one of her residences to each of her three other sons: her main residence in Bloomfield Hills goes to Kecalf; another home in that town to Edward; and her Detroit home to Teddy. 


At the time of her passing, Franklin’s estate was estimated to be about $80 million, but that is just a rough figure. In December 2018 the IRS filed a claim against the estate for $6 million in back taxes, and over $1 million in penalties. The agency continues to audit past years' returns. Also, Franklin had a stake in a yet-to-be-released film about her life; advance ticket sales have already generated over $3 million.

 
You may wonder why Franklin, with more than enough money to get expert legal help, would handle her final affairs in this manner. It is possible the answer can be found in her well-known passion for guarding her privacy. Ironically, her lack of sound planning has led to the very opposite outcome she would have wanted, with her finances and family circumstances open to public scrutiny.

Attorney David Wilson has stated that he often advised his client to create a will, and also a trust in order to keep her financial and family situation private. He says he had no idea she was writing  do-it-yourself, multiple wills. “If she had mentioned that to me,” he notes, “I would have said, ‘Aretha, what you really need to do is go see a lawyer and make sure it’s done in accordance with the law." Sounds like good advice for everyone.

Parents of children with intellectual disabilities should make sure their child's IQ is tested before age 18

Important alert for parents of special needs children with intellectual disabilities: Make sure your child is IQ tested before age 18. 

First, some background: Florida's  Agency for Persons with Disabilities determines if an individual with a disability is eligible for a Medicaid waiver. A Medicaid waiver can permit your special needs child to receive community-based assistance and avoid institutional living. Unfortunately, securing a waiver has never been a walk in the park. According to a recent Miami Herald article, thousands are on the waiting list - and it can take years to get off it.

  

The applicant's IQ test score is one of the factors used to determine waiver eligibility. The applicant's intellectual disability must have developed before age 18. Thus, in order to qualify for a Medicaid waiver, your child will need to have an IQ test administered at age 17 or younger. (In contrast to the Social Security Administration, which requires the test to be administered before age 22.)

Due to budget cuts, Florida public schools no longer routinely IQ test students suspected of intellectual disabilities. Therefore, we recommend that if you have a child with a suspected intellectual disability, make sure he is IQ tested before age 18. Private testing is available and generally costs between $1,000 - $2,000.  Health insurance does not usually cover such testing, but you have nothing to lose by making the case with your insurance company.

Parents and grandparents of special needs children naturally have many questions about how to best plan for the child's ongoing welfare and care. Contact The Karp Law Firm for assistance.

Supreme Court upholds Obamacare: Good news for parents of special needs children

On June 25 the Supreme Court rejected the last judicial challenge to the Affordable Care Act. Parents of special needs children are breathing a sigh of relief, because the law prevents insurance companies from denying coverage to their children based on pre-existing conditions. 

With "Obamacare" the law of the land, parents with sufficient assets to provide private health insurance for their child may now find that a Special Needs Trust is no longer their best planning tool. A Special Needs Trust can preserve a disabled child's access to Medicare health benefits, among other federal benefits. However, federal law severely restricts how the trust assets may be used. Just giving the beneficiary pocket money may imperil the individual's access to governmental benefits.

If you are a parent who can afford to furnish your child with private health insurance and don't need to preserve his/her access to Medicare, it may make sense to do away with the Special Needs Trust. Instead, you may want to consider leaving assets for your child in a discretionary trust, which gives you broader latitude to determine how the beneficiary may use the money. Or, if your child is capable of managing his/her own financial affairs, you may even wish to leave funds to him/her directly.

One caveat to the above: There is still talk about Congress taking future action to eviscerate the Affordable Care Act. If we have a president in 2016 who agrees with that agenda, special needs children could still be in peril. Please contact The Karp Law Firm to discuss your options.

Karp Law Firm volunteers at Palm Beach Special Olympics Bowling Event

"Karp's Kommandos" volunteered at the Palm Beach County Special Olympics Bowling Event on Sept. 13, helping to organize games and assisting participants. Our kind Kommandos included Attorney Joseph Karp; Estate Planning Paralegals Margaret Sajiun and Khristina Iwasz, who was accompanied by her mother and niece; Estate Administration Paralegal Norma Cruz and her daughter; and Case Manager Supervisor Deeanna Farrington, her son and a friend. Photos from the event:

 A Special Olympian gets an award from Attorney Karp

L-R, front: Margaret Sajiun; Norma Cruz; Khristina Iwasz' niece.
L-R, rear: Norma Cruz' daughter; friend of the Farrington family; Deeanna Farrington; Joseph Karp; Deanna Farrington's son; and Khristina Iwasz and her mother.

 L-R: Attorney Karp, Khristina Iwasz and Margaret Sajiun pose with a bowler

Deeanna Farrington's son and his friend take a break away from the the lanes

New legislation would help families of children with autism, other disabilities

Over the years, growing numbers of parents and grandparents have requested our help to create estate plans that provide for an autistic child. The statistics bear out what we see in our practice: According to the CDC, in 2010 one in 68 American children fell on the autism spectrum, up from 1 in 150 a decade earlier. The dramatic increase over the last decades is only partially explained by better screening and diagnosis.

Fortunately, many on the autism spectrum go on to lead fully functional lives. But for others, it is a severe and chronic disability that requires loved ones to make thoughtful legal and financial plans. One of the strategies we recommend to parents in these circumstances is the creation of a special needs trust to benefit the child.  You can read more about special needs trusts here.

We caution our clients against using a UGMA (United Gift to Minors Act) account as a vehicle to set aside money for a disabled grandchild - in fact, for any grandchild. A UGMA account is easy to set up, but beyond that, this type of account has little to commend it. Read more about UGMA accounts.

A recent and hopeful development in the fight against autism is the ABLE (Achieving a Better Life Experience) Act, currently under consideration in Congress. The bill would allow the creation of non-taxable savings accounts that may be used to cover medical and other expenses of disabled children, while preserving the individual's access to key government benefits and services like Medicaid. Read more about the ABLE Act here. To contact your congressperson in support of the legislation, click here. To contact your senator, click here. 

Also this past week, funding was renewed for the Autism Collaboration, Accountability, Research, Education and Support Act (Autism CARES, for short) that had been set to expire in September. The Act provides funds for education and research, and for the first time, calls for the appointment of someone at the Department of Health and Human Services to oversee all autism-related initiatives. 

Karp Law Firm volunteers at Special Olympics

Members of The Karp Law Firm staff were on hand on Sept. 7, 2013 at Greenacres Bowling Lanes to assist at the Special Olympics, organized by the Special Olympics at Palm Beach County. Participants representing our firm included Estate Planning  Paralegal Khristina Iwasz and her mother, Gerri Iwasz; Margaret Sajiun, Estate Planning Paralegal; Pat Vivirito, Estate Administration Paralegal; Elizabeth Lebron, Client Coordinator; and Assistant Case Manager Zamara Rosete and her brother Rogelio and friend Sarah. Our group, specifically Margaret Sajiun, Pat Vivirito, Elizabeth Lebron and Geri Iwasz, were in charge of ramp bowling, helping individuals who need additional assistance to land the ball on the alley. Special thanks to Khristina Iwasz for coordinating our participation in the event.

Karp Law Firm volunteer Zamara Rosete poses with a participant

 

Margaret Sajiun and Elizabeth Lebron assist bowlers

 Elizabeth Lebron helps get the ball down the alley

 Rogelio Rosete and friend