Upstate Estate Law, P.C. Blog

The Social Security Administration recently issued an Emergency Message to all personnel requiring workers to specifically inform SSI applicants or beneficiaries of the reasons a special needs trust has been rejected by the agency. And elder law attorneys everywhere say thank you!

In the past, when the SSA determined that assets in an SSI beneficiary’s or applicant’s trust were countable, the agency would frequently send a notice of ineligibility to the beneficiary or applicant because his/her assets exceeded the resource limit. However, this notice almost never explained the reasoning behind the SSA’s rejection of the trust.

The new Emergency Message, which went out to all field level SSA personnel, requires caseworkers to spell out exactly what portion of the Program Operations Manual System (POMS) applies to the trust being rejected. Unfortunately, the Emergency Message does not tell field workers that they have to explain their reasoning in plain English — merely citing the appropriate section of the POMS appears to be enough. While this will make it relatively easy for professionals to determine what went wrong with a trust and whether an appeal is in order, it will likely give the layperson little if any guidance about his or her trust.

To read the Emergency Message, go here.

The stories are starting to become more frequent and familiar. They generally involve grieving families trying to access their deceased loved one’s online accounts, social media, or even devices such as iPhones and iPads. Those of us who are online are likely to amass a great deal of data, such as messages, emails, voice mails, photos, passwords, music, and videos on our devices and in the cloud, which can become painfully out of the reach of our loved ones after our lifetimes. It can be difficult to even obtain a password to access an iPhone or iPad of a deceased loved one without a court order. Add on top of this the frustration of each online service provider instituting it’s own policy for providing access to our loved ones’ accounts, you can easily see that this is a situation we would want to avoid.

See the links below for recent examples:

Widow Needed A Court Order to Access iPad

A Legal Showdown With Apple To Access iPhone Photos

Is there anything you can do to plan for allowing your family access to your online life, if that is your wish? Of course there is. I will talk about that in Part 2 of this post.

Since it is the giving season, let’s talk estate and gift taxes! The IRS recently announced the new estate and annual gift tax exclusion amounts for 2016. In 2016 the estate tax exclusion amount will be increased to $5.45 million per individual estate, which means a married couple can shield up to $10.9 million from estate taxes. The annual gift tax exclusion amount remains at $14,000.00 per donor per individual recipient.

These amounts had originally been set at $5 million and $13,000.00 respectively, by The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 enacted on December 17, 2010, since indexed to inflation by the American Taxpayer Relief Act of 2012 enacted on January 2, 2012.

If you anticipate that your estate (including life insurance, retirement benefits, and inheritances you might receive from others) may be above $5.45 million individually, or above $10.9 million as a married couple, you should consider a thorough estate planning review. There are often ways to help reduce or even eliminate estate and gift tax liability through careful estate planning.

You can see the IRS announcement here.

I get this question pretty frequently. The terms above refer to two very general categories of trusts.

An inter vivos trust is a trust that was created during the lifetime of its creator (the Grantor or Trustor).

A testamentary trust is set up upon the death of its creator, usually in the creator’s Last Will and Testament.

Some distinctions are that an inter vivos trust may be freely revocable and modifiable by its creator during his/her lifetime, whereas the testamentary trust is typically irrevocable, except under certain circumstances. The inter vivos trust may be set up to accomplish asset management, incapacity planning, or Medicaid planning for its creator. A testamentary trust is useful to protect the creator’s eventual beneficiaries from dissipating their inheritance through immaturity, creditors’ claims, divorce, and the like.

These two trust types probably represent the most general distinction that can be made among trusts. Make no mistake though, there are a lot of different types of trusts that can be created. In future posts, I will write more about these different types of trusts.

Since my young son was diagnosed with high functioning autism while in kindergarten a few years ago, I have become more aware of the rights and requirements of the federal Individuals with Disabilities Education Act (IDEA), and have had my share of IEP meetings and updates with his schools. For others dealing with these issues, an interesting problem could arise when a child who is eligible to receive special educational services under IDEA turned 18 years old.

Prior to the child reaching the age of 18, the rights under IDEA would be accorded to the child’s parents. But when the child turns 18, the rights transfer to the child. This obviously brings up the issue of what happens if the child is not capable of exercising those rights? A newly proposed statute would allow several resolutions to this issue.

First, if the child has not previously been determined to be incapacitated, the child may delegate these rights to another adult. This could be done via a power of attorney or other document to be created by the South Carolina Department of Education.

Second, if the above cannot be accomplished, it would be possible for certain qualified licensed professionals to make a certification in writing that the student is incapable of providing informed consent to make educational decisions. This certification would allow the custodial parents of the child to make decisions as an educational representative, or if they are not available, certain other designated close family members. The child would have the chance to object to this certification, and a determination of incapacity pursuant to a guardianship proceeding would seem to take precedence over this certification.

This proposed act appears to make it somewhat easier for family members to maintain control over an adult student’s rights to an education under IDEA. Without these amendments it would seem that the only alternative would be to bring a guardianship proceeding in order to gain control over the right to make educational decisions. However, the guardianship proceeding might very well not be appropriate in every situation, and can be a costly endeavor.

This new proposed law seems to try to fill in this gap where somebody may have rights under the law but be unable to adequately and thoughtfully exercise those rights. If there is any news on this new law I will provide an update, so keep coming back.