| David M. Frees, III |
Phone: 610-933-8069 120 Gay St, Phoenixville, PA 19460 |
Douglas L. Kaune |
A special needs trust is a way to provide your disabled loved one
without the assets affecting their government eligibility into
programs like Medicaid and Social Security Disability.
Find out if a Special Needs Trust is right for you.
Read the entire Report on Pennsylvania Special Needs Trusts/ Supplemental Needs Trust here.
Yes.
If you are disabled and receive benefits and a personal injury award
and or inheritance and you do not want to be disqualified from
government benefits a “self-settled” trust can help. A “self –settled” trust
is frequently created by individuals who have become disabled as a result
of an accident or medical malpractice and later receive a personal injury
award or settlement. This type of trust has specific requirements in order
to keep your government benefits such as Medicaid, Social Security, and
Section 8 Housing.
Please click here to read the entire Report on Pennsylvania Special Needs Trusts.
Special Needs Trusts Require The Right Trustee For A Tough Job
The trustee of any trust is an
important position.
In special needs trusts the trustee has
sole discretion to decide what the
beneficiary, your disabled loved one,
needs and what can be distributed
under state laws or federal regulations
without disqualifying the beneficiary.
They may spend quite a bit of time at the job in order to do it well.
They also often have the authority to liquidate the trust.
In short, trustee selection is vitally important,
If you are going to be the trustee
make sure you have a back-up trustee so if something
happens to you the right person is in place to take
on this important responsibility.
Also keep in mind if the trust is not administered correctly
your loved one could lose the benefit of government programs.
To read the entire Report on Special Needs Trusts/ Supplemental Needs Trusts click here.
To Find Out More About Special Needs Trusts and Who To Select as Trustee
Call David M Frees III Chairman Trust, Estates, and Wealth Preservation
610-933-8069 or dfrees@utbf.com
Special Needs and Supplemental Needs Trusts Are The Vital
Tool To Protect Our Loved Ones When We No Longer Can
A special needs trust or supplemental needs trust is a way to provide
for your disabled child or disabled loved ones quality of life.
The great thing about this type of trust is your child or loved one
will not be disqualified from government programs because
the assets are not considered theirs. In order to have the assets
in this type of trust unavailable to the government see the complete
Report on Pennsylvania Special Needs Trusts.
If you already know that you need to do estate planning,
or to update an old will or trust, for a special needs child or heir,
then please call 610-933-8069 and mention this article by David
Frees for a discounted estate plan only available to
David’s blog readers and existing clients and their families.
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Get this off your TO Do list. Call 610-933-8069 or
email dfrees@utbf.com for a call to schedule your planning
appointment.
David M. Frees III on Breaking News About Asset Protection Trusts
The general rule, in most states,(including Pennsylvania’s trust law) is that you cannot create a trust (a self-created trust) and then claim that your creditors cannot reach it.
And, the IRS generally takes the position, that when you create a trust, it remains in your estate for estate tax purposes if you retain the right to continue to use the trust assets, your creditors’ can reach them under state law, or you retain the right to benefit from or to control the assets.
And, for that reason, the residents of Pennsylvania tha are interested in creditor protection have started creating trusts under the laws of Delaware and/or Alaska, Nevada or other states that permit these asset protection trusts.
However, there has always been some question about whether these new trusts (now permitted in 12 states including Delaware, Alaska, Utah and Nevada) are effective for asset protection and whether or not the Service would claim that they were to be taxed at death since they do often allow for the grantor or settlor (the creator of the trust) to get distributions from the trust under certain circumstances.
However, in a recent PLR (Private Letter Ruling 200944002) the IRS confirmed that an Alaska self created trust will not be included in the creator’s estate for estate tax purposes. However, the ruling is limited on it’s face to an Alaska resident using an Alaska trust. And, the PLR seems to also turn on the fact that under the particulars of that state law, the creditors could not reach the assets. However, in some states that have asset protection trusts, there are provisions that allow creditors to reach assets under certain circumstances that might still cause their inclusion in your estate.
So, if you have or intent to create a trust under one of the 12 states laws that now permit such asset protection trusts, you now, for the first time, have something from the IRS to help you to evaluate the effectiveness, the pros and cons of these trusts.
Now under IRC (Internal Revenue Code) section 6110(k)(3) Private Letter Rulings cannot be cited or used as precedent. And, these rulings are specific to the facts, the type of trust, the trustees, and many other factors. However, this one does expressly hold that the trust is not includable in the estate.
In summary, and according to Douglas Blatmacher this ruling provides planners and their clients “who have been hesitant to make large gifts (for fear of future needs)” – “with a strategy that not only provides asset protection, but significant potential estate tax savings while at the same time the comfort of knowing that if the settlor requires some portion of the funds transferred a trustee can provide for them.”
More specifics on this to follow as we analyze this important development.
David M. Frees III Asset Protection Attorney and Will Trust and Estate Lawyer
Asset Protection and Self-Settled Trusts
Trusts, Estates, Asset Protection and Wealth Preservation
Law Offices in Phoenixville, Malvern and West Chester
Our Will, Trusts, and Estates Planning Lawyers
serve clients in Chester County, Montgomery County
Philadelphia County and Delaware, Lancaster, and Berks and Bucks Counties
Are you considering making end of year estate planning gifts to children, grandchildren or great grandchildren?
Curious about how much you can give without paying gift tax? This brief video tells you how much you can give without paying taxes.
Want to avoid the mistakes that people make that can actually cost your heirs money?
Need to know whether or not you need to file a gift tax return? Click here to get your answer to the question “How much Can I Give Without Filing A Gift Tax Return?”
I just published an article on The Five Most Common Mistakes that People Make with End of Year Estate Planning Gifts, and How to Avoid Them. Be sure to read this article and the two additional artciles on gifting that will be published in the next few weeks.
Make sure that your gifts work, that they count, and that you maximize them without making some of the horrible mistakes that can cost your heirs dearly. Read: End of Year Gift Tax Mistakes and How To Avoid them.
David M. Frees III
Offices: West Chester, Phoenixville, Malvern
Serving Chester County, Montgomery County and
All of the Counties in the Greater Philadelphia Area
For appointments call: 610-933-8069
dfrees@utbf.com
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