Facilitating Involvement of Family and Friends with Special Needs
Trusts
by
Herbert D. Hinkle, Esq. and Ira Fingles, Esq.
Hinkle & Fingles, Attorneys at Law
2651 Main Street
Lawrenceville, New Jersey 08648
(609) 896-4200 or (215) 860-2100
Visit two residential programs in your state which serve people with
disabilities. Choose one of the best and choose one of the worst. What
will be different about the two programs beyond the quality of each?
Both programs will serve people with similar clinical profiles. The
difference then? The client in the better program will have interested
family members or friends visiting them regularly. The client in the
other program will seldom, if ever, have visitors.
How does this relate to a special needs trust (“SNT”)? A SNT is a
legal instrument designed to hold assets set aside for the benefit of
a person with a significant disability. If properly drafted, it will
preserve eligibility for key programs like Supplemental Security
Income and Medicaid and it will shield assets from government
recoupment laws which apply to many services rendered.
Too often, in drafting and implementing SNTs, the emphasis is on
directly supplementing the services available to the disabled
beneficiary. While this is important, it can miss the mark. It is
extremely important to use trust assets to ensure the involvement of
family and friends. These non-traditional uses of SNTs will be the
focal point of this article.
Consider this example: John, age 30, lives in a group home in
Pennsylvania where he is well established and has many friends. His
parents are deceased. His sister, Alice, lives in Texas and his
brother, Ralph, lives in California.
To encourage Ralph and Alice to visit John as frequently as possible,
the SNT should pay for all of their travel expenses. We do not want
their spouses grumbling about such expenditures or a sibling to have
to choose between visiting John or saving money for their own
children's college education.
For similar reasons, a fee should be available to compensate Alice and
Ralph for their time. Some might protest that siblings should do this
without being paid. But their time is important and we want to
encourage - - not discourage - - involvement. The SNT will also
reimburse Alice and Ralph for any child care expenses, as well as all
other expenses incurred.
Even if Alice and Ralph live next door to John, there will be a
similar expense for child care, for their time and for any other
pocket expenses incurred.
Suppose John has no siblings or friends, or that they cannot visit
frequently, what then? In many states there are organizations (some
are referred to as “PLAN,” which stands for Planned Lifetime
Assistance Network), which, for a fee, will visit and monitor a
person's placement and provide a report, either to family who cannot
visit regularly, or to the trustee of the SNT. Small problems can be
resolved by the monitoring organization, larger problems might require
the intervention of the family, guardian, trustee and even legal
assistance. The organization can monitor everything from the
appropriateness of day and residential services, to the frequency of
attendance of religious and recreational activities.
It is important that the SNT contain language making it clear that
expenditures for such purposes are permitted. Trustees should not have
to guess as to whether such expenditures are appropriate, or worse,
trustees should not feel compelled to deny such expenditures.
How much is necessary for these purposes?
How can parents ensure that sufficient funds will be available?
______
Herbert D.
Hinkle, his partner, Ira M. Fingles and their colleague, S. Paul
Prior, maintain a statewide
law practice with offices in Lawrenceville, Marlton, and Florham Park,
New Jersey, and Yardley, Pennsylvania. They lecture and write frequently
on topics of law, aging, disability and estate planning and are available
to speak to groups in New Jersey and Pennsylvania
at no charge.
Comments and suggestions
for future articles should be mailed to: Hinkle & Fingles, 2651 Main Street, Suite A, Lawrenceville, New Jersey 08648-1012.
Copyright 2004
Herbert D. Hinkle. All rights reserved.
