FAQs by Category
Special Needs Trusts and ABLE Accounts
What is a Special Needs Trust?
A Special Needs Trust is a legal document that makes money invisible. Why does money need to be invisible? Because services for individuals with disabilities have low income & asset limits. By using a Special Needs Trust, an individual with a disability can meet the low income and asset limits for services while still having unlimited funds in the trust. There are different types of Special Needs Trusts (First Party, Third Party, Pooled Trust)—the right trust for your plan depends on whose money is going into the trust.
Is it possible to have more than one Special Needs Trust?
Yes. In general, there are three types of Special Needs Trusts:
(1) First Party Special Needs Trusts (aka OBRA ’93 or (d)(4)(A) Trusts) hold funds that belong to the individual with a disability, i.e. legal settlement, wages, social security payments, etc.
(2) Third Party Special Needs Trusts (aka Supplemental Needs Trusts) hold funds that belong to anyone other than the individual with a disability, i.e. gifts/inheritance from parents, grandparents, etc.
(3) Pooled Trusts (aka (d)(4)(C) Trusts) hold funds that belong to an individual with a disability, and is most typically used for individuals over the age of 65.
Because Special Needs Trusts serve different purposes, it is possible that an individual will need more than one Special Needs Trust.
What is the best way to leave an inheritance to an individual with a disability?
The best way to leave an inheritance to an individual with a disability is to create a Third Party Special Needs Trust for the individual’s benefit. For example, Liam Smith has a disability and is receiving public benefits. Liam’s parents hire an attorney who create their Wills and a Third Party Special Needs Trust for Liam. The language in their Wills directs Liam’s inheritance to the “Trustee of the Liam Smith Third Party Special Needs Trust.” In addition, the attorney advises Liam’s parents to update beneficiary designations on certain accounts (i.e. life insurance, retirement, etc.) to name Liam’s Trust as the beneficiary. By directing Liam’s inheritance to the Trust (as opposed to Liam directly), Liam will maintain eligibility for public benefit programs at the time the Trust is funded.
When should I start legal planning for my child with a disability?
It sounds cliché, but it is never too early to start legal planning for a child with a disability. Even if a child is especially young, and their future trajectory is not fully known, it is important to have a plan in place that protects any future benefits that the child might receive. Legal planning documents can be drafted with great flexibility so that the documents can be changed or revoked at any time. Your legal plan is like a safety net—it is there to catch and protect an inheritance for your child, in the event that the unexpected should happen.
What is an ABLE Account?
An ABLE (Achieving a Better Life Experience) Account is a tax-advantaged bank account for individuals whose disability began before the age of 26. Like a Special Needs Trust, an ABLE account makes money invisible in order to meet low asset limits for disability services. There are limits on how much money can be placed in the ABLE account each year ($15,000, or more if contributing wages). The funds must be used for the disability related expenses of the account holder. Connecticut recently opened an ABLE program (savewithable.com). However, Connecticut residents are not required to open a Connecticut ABLE account and may instead open an account in another state that accepts non-residents (ablenrc.org).
Supplemental Security Income (SSI) & Social Security Disability Insurance (SSDI)
What is SSI?
SSI stands for “Supplemental Security Income.” It is a monthly cash payment of up to $794 (January 2021) for individuals with a disability who have less than $2,000 to their name (outside of a special needs trust and/or ABLE Account).
What is SSDI?
SSDI stands for “Social Security Disability Insurance.” It is a monthly cash benefit that is obtained in two ways. First, an individual with a disability who paid into social security may receive this cash benefit through their own work record. Second, an individual with a disability who has not worked can obtain SSDI through a parent who paid into social security and who is retired, who has a disability, or who is deceased.
When Should I Apply for SSI?
The timing of an SSI application depends on whether parents’ money will be counted as part of the child’s resources in meeting the low resource limit of $2,000. In general, individuals apply for Supplemental Security Income (SSI) at age 18. Before age 18, parents’ resources are deemed to belong to their children. This means that if the parents’ resources (aka money), combined with the child’s resources, exceed the $2,000 limit, the child will not be eligible for SSI. At age 18, parents’ resources are no longer considered to belong to the child, because the child has become a legal adult. Therefore, only the adult child’s resources are counted toward the $2,000 resource limit. Keep in mind that an individual can place resources exceeding $2,000 into an ABLE account and/or First Party Special Needs Trust and still qualify for SSI.
Decision Making Tools at Age 18+
What is a Power of Attorney?
A Power of Attorney is a written legal document where an adult (age 18+) appoints one or more individuals to manage his/her/their finances, in the event that the individual is unable to manage finances independently, or if the individual simply requests that the Agent manage finances on his/her/their behalf. A Power of Attorney can also include educational decision making authority, which would allow the designated agent(s) (i.e. parents) to continue participating in PPT’s and other educational decisions.
What is an Advance Directive?
An Advance Directive is a written legal document where an adult (age 18+) appoints one or more individuals to make healthcare decisions on his/her/their behalf, in the event that the individual is unable make healthcare decisions for oneself, or in the event that the individual simply requests that the representative make medical decisions on his/her/their behalf. This document may also include a Living Will, which sets forth an individual’s end of life wishes if he/she/they are terminally ill or permanently unconscious.
What is the difference between Guardianship & Conservatorship?
Guardianship is created by the Probate Court for an adult (age 18+) with an intellectual disability (IQ of 69 or below) who needs assistance in caring for oneself. A Guardian may also obtain special permission to manage up to $10,000 of the individual’s money. Conservatorship is created by the Probate Court for an adult (age 18+) who typically has an IQ above 69 and who needs assistance in caring for oneself and/or managing one’s personal finances.
What is Supported Decision Making?
Supported Decision Making is an alternative option to guardianship / conservatorship. It is a written agreement between an adult with a disability (age 18+) and designated “supporters” who agree to guide the individual in making various life choices. While the individual with a disability may rely on the advice of the designated supporters, the individual retains the independence to make decisions for oneself.
Medicaid Supports & Services
What is Medicaid?
Medicaid, also referred to as “Husky,” is a health insurance plan for Connecticut residents who meet low income and/or asset limits. In addition, Medicaid is a source of services and supports for individuals with disabilities. In general, an individual must be enrolled in Medicaid Husky C in order to access DDS (Department of Developmental Services) and Autism services.
What is Community First Choice?
Community First Choice (CFC) is a Medicaid program that is available to individuals who need assistance with hands-on care, and/or who need support in independent living. CFC provides a budget based on an individual’s level of need. The budget is then used to hire personal caregivers to provide the required supports. This program is self-directed, meaning that the individual (or his/her/their representative) hires and manages staff. If an individual has funding through the Connecticut Department of Developmental Services, this will partially or completely reduce the funding available through CFC.
What is the Autism Waiver and when should I apply?
The Autism Waiver is a Medicaid program for individuals with Autism, which Connecticut defines as an individual with an IQ of 70 or higher who has substantial limitations in two or more major life activities (i.e. self-care; independent living; learning; self-care; understanding/using language; mobility; self-direction) that onset before the age of 22. Individuals who are enrolled in the Autism Waiver receive lifelong supports in various aspects of their life, which may include behavioral supports, social skills and life skills training, job coaching, assistive technology, and residential supports. You should apply for the Autism Waiver as soon as possible, as there is a long waiting list to access these services.
What is the Connecticut Department of Developmental Services (DDS) and when should I apply for DDS Services?
The Connecticut Department of Developmental Services (DDS) is the state agency that serves individuals with Prader-Willi Syndrome and Intellectual Disabilities. Connecticut defines Intellectual Disability as an IQ of 69 or below coupled with deficits in adaptive behavior (i.e. social skills, life skills, personal care, independent living, etc.) that began before the age of 18. An individual generally applies for DDS services at age 8.
Once enrolled in DDS, an individual is eligible for basic “Helpline” services, such as respite services and one-time grants for in-home supports. In addition, an individual typically enrolls in the DDS Employment and Day Supports waiver when he/she/they graduate from school, though services may be available sooner depending on the individual’s needs. The Employment and Day Supports waiver provides daytime services, such as employment and day program opportunities and transportation services.
In addition, individuals may also receive DDS Residential Supports through a Medicaid waiver, which provides support to individuals living within or outside the family home. Residential funding is often reserved for individuals who have an emergent need for support. For this reason, there is a waiting list for residential funding.