A New York Supplemental Needs Trust Can Protect Assets for An Incapacitated Person

When dealing with matters concerning an incapacitated person, one of the primary concerns is finding the resources to pay for the living expenses and care of the individual. New York Guardianship Lawyers must always determine the type of assets, income and benefits that are available. Incapacity can take many forms and the nature of a disability will be reflected in the expenses incurred. For example, an individual may have been the victim of an accident or stroke and need 24 hour nursing home care. On the other hand, a person may have dementia or Alzheimer’s disease and may be able to live at home with their family.

In situations where care expenses are extensive, personal resources may be unavailable or may have been exhausted. Also, it is possible that as a result of Elder Law Planning and Estate Planning, a person may have transferred assets to others many years before the onset of a disability. Where assets are limited, it is common that government benefits such as Medicaid and Social Security would be available to pay for the cost of care.Issues arise where a person who is receiving or is applying to receive government benefits has available resources that would diminish a government subsidy or would be subject to exhaustion or a claim for a refund by the government.

The New York Probate Lawyer Blog has previously discussed the benefits of a Supplemental Needs Trust (“SNT”). This type of trust allows funds to be held for the benefit of an individual but would not interfere with or cause the termination of Medicaid or other government payments. The SNT Trustee typically has discretionary authority to use the SNT funds to add to the quality of life for the trust beneficiary.

New York estate and trust law recognizes the need and validity of a SNT. Estates, Powers and Trusts Law Section 7-1.12 entitled “Supplemental needs trusts established for persons with severe and chronic or persistent disabilities”, sets forth the statutory requirements for a SNT. The use of a SNT can be very beneficial since it provides a means by which a person with a disability can obtain extra health care and life enhancing benefits without risking the basic payments provided through governmental programs. In many cases such as Guardianship Proceedings, the Courts will approve the creation and maintenance of a SNT. A recent example of such approval was seen in a case entitled Matter of Carmen. In this case, which was decided by Bronx Surrogate Nelida Malave-Gonzalez on May 6, 2015, a person suffering from mental retardation was about to receive a share of the estate left by her mother. The Co-Guardians for the incapacitated person asked the Court to place the estate funds into a SNT and to appoint them as Trustees. The Court approved the Guardian’s application so that the person could receive the benefit of her estate share without losing her Medicaid and other benefits.

I have represented many individuals in Guardianship cases where the Court has allowed the creation of a SNT to protect assets and funds that could be used for their well-being. If you have any questions concerning a SNT or a Guardianship proceeding call me for a free discussion concerning your issue.

New York Guardianship Attorney Jules Martin Haas, Esq. has been representing clients in New York Guardianship Proceedings, throughout the past 30 years in New York, including Queens and Nassau Counties. If you or someone you know is involved with or has questions about a New York Guardianship matter, please contact me at (212) 355-2575 or email: jules.haas@verizon.net, for an initial consultation.

Jules Martin Haas provides his clients and members of the community with a free monthly e-newsletter which contains articles covering a variety of legal topics including estate planning, financial matters and real estate. If you wish to be placed on the e-newslist, simply e-mail me at jules.haas@verizon.net. You can cancel receiving the newsletter at anytime.

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