Pooled Trust Program

Pooled trust programs are a convenient way to provide money to a person with disabilities without sacrificing government benefits. These trusts protect a person’s or family’s financial assets while still providing extra money to loved ones. A pooled trust must be set up and managed by a not-for-profit organization.

Have Questions?

What is a Guardianship?


A Guardianship is a court-approved legal relationship between a competent adult (known as a guardian) and a minor child or an adult who has been declared legally incompetent. It gives the guardian a defined degree of authority and a duty to act on behalf of the person in making decisions affecting that person’s life. The role of the Guardian is established by state law. Guardianship is a legal, not medical determination. Parents are legal guardians only until their children reach the age of 18, regardless of disability. When a child becomes an adult at 18, he or she receives all the legal rights and responsibilities of any adult. Only the courts have the authority to remove these rights. Parents who want to retain decision-making power must go to the courts to seek guardianship. A court makes this decision based on the person’s abilities to handle personal decisions, money, property and similar matters. The incapacity (or legal inability) to handle these matters, not the disability, is grounds for a guardianship.




How do I decide if my child needs guardianship?


Appointing a guardian for someone is a serious matter. This legal status deprives the person of some rights and independence, and could potentially lead to the abuse of power. However, there may be reasons why a son or daughter with a disability may need a guardian. Some of the common reasons are: Medical care or other services will not be provided unless there is a clear understanding about the person’s legal capacity to consent to treatment or services. Parents or siblings cannot get access to important health records or other documents. The person has assets he or she cannot adequately manage.




What are the different types of guardianship?


Guardian of the Person or Property – the individual needs a guardian to decide personal issues, such as where to live, consent for medical treatment and signing for services. The court will usually identify specific decision-making areas and require periodic reports from the guardian about actions taken over the course of the year or other period.

Full Guardianship – this includes guardianship over all the person’s personal and property decision-making. It is usually a collection of all the powers and responsibilities and involves controlling every aspect of the person’s life. It is the most restrictive, although the person under a full guardianship still retains his or her basic civil rights. This type of guardianship is useful for individuals with a disability so severe that they are not capable of making informed decisions and should be used only after exploring the alternatives, including limited guardianship. Courts are most familiar with full guardianship as it is the most common.

Limited Guardianship – offering a middle ground, this guardianship is for persons with developmental disabilities who are competent, but need some supportive assistance to make certain choices, such as where to live. Limited Guardianship provides only specific powers to the Guardian, rather than relinquishing complete control over life decisions for the person with special needs. These powers or rights often include the right to enter into a financial contract, choose an educational program, receive medical care, enter into marriage and so forth. Each power is delivered to the Guardian in an “all or nothing” fashion, that is, with complete authority to make decisions in a selected area. For this reason, courts in many states authorize a mix of guardianships. For example, a person may need full guardianship of the estate but only limited guardianship over personal matters.

Temporary Guardianship – some states allow guardianship for a limited time. The court may issue a “protective order” or temporary guardianship when a legal problem arises from a specific situation, giving another person, a public guardian or corporate guardianship program* the authority to handle that specific situation. When the problem is resolved, the order usually ends with no permanent guardianship. For example, medical or other treatment may be necessary because of questionable ability to consent, but once the treatment is provided, the guardianship is reviewed to determine if it should be removed.

* These guardianships should be explored with a knowledgeable attorney as they generally involve state resources or incorporated agencies.





Grandparent Planning

 

Grandparents want the best for their children and grandchildren, and thus often worry about a grandchild with a disability who may need additional assets or assistance. Those in a position to leave money are often told not to leave their grandchild with disabilities anything because the child may lose government benefits. Avoid confusion and take a look below at some helpful planning do's and don'ts.

Do’s and Don’ts of Planning for Your Grandchild with Special Needs

Don’ts:


Don’t disinherit your grandchild(ren) with special needs. Money can be left to a properly drawn special needs trust. Don’t give money to your grandchild(ren) with special needs under UGMA or UTMA (Uniform Gift or Transfer To Minors Act). Money automatically belongs to the child(ren) upon reaching legal age. Government benefits can be lost. Don’t leave money to grandchild(ren) with special needs through a will. Money left will be a countable asset of the child and may cause the loss of government benefits. Don’t leave money to a poorly set-up trust. Money left in an improperly drafted trust can result in the loss of government benefits. Don’t leave money to relatives to keep or hold for the child with special needs. The money can be attached to a lawsuit, divorce, liability claim or other judgment against the relative.




Do’s:


Make provisions for your grandchild(ren) with special needs. Leave money to the child’s special needs trust. The special needs trust is the only way to leave money without losing government benefits. Coordinate all planning with the child’s parents or other relatives. Notify the parents when you plan for grandchild(ren). Plan with others. Leave life insurance, survivorship whole life policies and annuities to the child’s special needs trust. The special needs trust can be named as the policy beneficiary. When the insured or annuitant dies, the death benefit is paid to the special needs trust. The trust then has a lump sum of money to be used in caring for the grandchild(ren) with special needs. Consult with trained financial and legal professionals with specialities in special needs estate planning.





Guardianship

 

If you're concerned about who will look after your loved one, you're not alone! Some families rely on other family members or friends, while others enter into formal arrangements with individuals or advocacy organizations such as The Arc. An advocate can offer advice and other assistance concerning an individual with disabilities, but cannot make legal decisions. Legal decisions are generally handled through a Guardianship.

Have Questions?

What is a Guardianship?


A Guardianship is a court-approved legal relationship between a competent adult (known as a guardian) and a minor child or an adult who has been declared legally incompetent. It gives the guardian a defined degree of authority and a duty to act on behalf of the person in making decisions affecting that person’s life. The role of the Guardian is established by state law. Guardianship is a legal, not medical determination. Parents are legal guardians only until their children reach the age of 18, regardless of disability. When a child becomes an adult at 18, he or she receives all the legal rights and responsibilities of any adult. Only the courts have the authority to remove these rights. Parents who want to retain decision-making power must go to the courts to seek guardianship. A court makes this decision based on the person’s abilities to handle personal decisions, money, property and similar matters. The incapacity (or legal inability) to handle these matters, not the disability, is grounds for a guardianship.




How do I decide if my child needs guardianship?


Appointing a guardian for someone is a serious matter. This legal status deprives the person of some rights and independence, and could potentially lead to the abuse of power. However, there may be reasons why a son or daughter with a disability may need a guardian. Some of the common reasons are: Medical care or other services will not be provided unless there is a clear understanding about the person’s legal capacity to consent to treatment or services. Parents or siblings cannot get access to important health records or other documents. The person has assets he or she cannot adequately manage.




What are the different types of guardianship?


Guardian of the Person or Property – the individual needs a guardian to decide personal issues, such as where to live, consent for medical treatment and signing for services. The court will usually identify specific decision-making areas and require periodic reports from the guardian about actions taken over the course of the year or other period.

Full Guardianship – this includes guardianship over all the person’s personal and property decision-making. It is usually a collection of all the powers and responsibilities and involves controlling every aspect of the person’s life. It is the most restrictive, although the person under a full guardianship still retains his or her basic civil rights. This type of guardianship is useful for individuals with a disability so severe that they are not capable of making informed decisions and should be used only after exploring the alternatives, including limited guardianship. Courts are most familiar with full guardianship as it is the most common.

Limited Guardianship – offering a middle ground, this guardianship is for persons with developmental disabilities who are competent, but need some supportive assistance to make certain choices, such as where to live. Limited Guardianship provides only specific powers to the Guardian, rather than relinquishing complete control over life decisions for the person with special needs. These powers or rights often include the right to enter into a financial contract, choose an educational program, receive medical care, enter into marriage and so forth. Each power is delivered to the Guardian in an “all or nothing” fashion, that is, with complete authority to make decisions in a selected area. For this reason, courts in many states authorize a mix of guardianships. For example, a person may need full guardianship of the estate but only limited guardianship over personal matters.

Temporary Guardianship – some states allow guardianship for a limited time. The court may issue a “protective order” or temporary guardianship when a legal problem arises from a specific situation, giving another person, a public guardian or corporate guardianship program* the authority to handle that specific situation. When the problem is resolved, the order usually ends with no permanent guardianship. For example, medical or other treatment may be necessary because of questionable ability to consent, but once the treatment is provided, the guardianship is reviewed to determine if it should be removed.

* These guardianships should be explored with a knowledgeable attorney as they generally involve state resources or incorporated agencies.





Is leaving money to siblings on behalf of a person with disabilities a good or bad idea? Many attorneys advise parents of a child with disabilities to disinherit that child and leave their inheritances to the child’s siblings. If they receive any money, they will lose their government benefits, so why leave them anything at all? The sibling can use that money to look after and provide for the child with disabilities during his or her lifetime, but they are not obligated to do so.

These inheritances are called “Morally Obligated Gifts.” The sibling is morally obligated to provide funds, but not legally obligated. Distributions to siblings are now their monies and not those of the child with special needs. Money can be stolen, mismanaged and attached through divorce, bankruptcy or lawsuit. Money may never be used on behalf of the child with special needs as originally intended.

Financial Responsibility

 

The Arc of Mercer County

850 North Hermitage Road
Hermitage, PA 16148

P: 724-981-2950
F: 724-981-1877

E: mcar@mercerarc.org

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