Special Needs Trusts Explained

estate planning lawyer in New YorkSpecial Needs Trusts are used to help family members, loved ones and friends who suffer from debilitating mental and physical problems. Special Needs Trusts are also referred to as Supplemental Needs Trusts. The purpose of these trusts is to set aside funds and other valuable assets to help mentally or physically disabled individuals live with comfort and dignity. The assets put into these trusts can be utilized by the disabled individuals while not creating any problem which jeopardizes them from receiving government benefits such as Medicaid and Social Security Disability. Some situations where these trusts are commonly utilized are where the beneficiary of the trust has received a large award from a medical malpractice case, a personal injury case, or through an inheritance. These trusts set up a procedure where a trustee is appointed. This trustee uses the funds in the trust to pay for expenses of the beneficiary of the trust. The beneficiary of the trust cannot have actual access to the trust funds.

Two Types of Special Needs Trusts

The first type of Special Needs Trust is called a First Party Supplemental Needs Trust. In this situation a family member, usually a parent, sets up the trust for a person who is mentally or physically handicapped and also under 65 years of age. After the death of the beneficiary, if the beneficiary had been receiving Medicaid, Medicaid has a right to recover the money paid to the beneficiary during the course of their lifetime for medical benefits from whatever funds still remain in the trust at the time of the beneficiary’s death.

Third Party Special Needs Trusts

A Third Party Special Needs Trust can be created for a special person at any age. This trust also protects the beneficiary’s rights to receive benefits such as Medicaid or Social Security Disability. With regard to this type of trust, when the beneficiary dies, the assets of the trust are distributed pursuant to the terms of the trust to the individual named as beneficiary in the trust. Medicaid cannot go after the assets in the trust to repay them for funds expended during the lifetime of the beneficiary of the trust.


The two types of Special Needs Trusts can help special individuals, disabled individuals and the chronically ill while allowing them to collect all applicable governmental benefits. These types of trusts have helped tens of thousands of Americans with medical or mental problems live happy, comfortable, fulfilling lives.trusts attorney on Long Island

How Do I Avoid Probate?

estate planning lawyerIn some states, the probate process can be long and expensive. Wills, when they are probated, are public documents and anyone can go to the courthouse and view the Will. While there is a valid reason for drafting a Will and having it probated, in some cases this may not be the very best way to handle the transfer of assets from one generation to the next. This is especially true when the individuals involved are of modest means and do not have significant amounts of property. The following are several examples of devices which can be used to avoid the necessity of probate.

Joint Ownership of Property

When two individuals own property, and they want the survivor of the two to become the sole owner of the property they enter into a type of deed which specifically has the right of survivorship. In New York State a deed which allows for the survivor to inherit the property is called a joint tenancy with right of survivorship, or a tenancy by the entirety for married individuals. This type of deed causes the property upon the death of the first one to die to automatically vest title to the entire parcel of property in the other individual’s name.


Simply speaking, if you gift your assets to others during the course of your lifetime you will have no property to be inherited at the time of your death. There are various Internal Revenue Service rules concerning the gifting of property. As of the writing of this article an individual can gift up to $5,430,000 (a married couple can give $10,860,000 specifically $5,430,000 for both the husband and wife) during the course of his or her lifetime without it creating a Federal taxable event. The amount an individual can give to others during his or her lifetime goes up each and every year based on a formula which deals with inflation. In addition, an individual can, each and every year, give the sum of $14,000 to each recipient in each calendar year. Couples who are married, therefore, can give up to $28,000 to individuals in each and every calendar year.

If a family friend or loved one has medical bills, you can offer to pay for the medical treatment and there is no limit under the Internal Revenue Code as to payments of this nature to help out a friend or loved one.

Living Trusts

A living trust is a testamentary vehicle which will allow an individual to avoid having a will which needs to be probated. In theory, the individual puts his assets in the name of the living trust and therefore these assets are removed from the individual’s estate. When living trusts are created it is necessary to have a pour over will drafted so any assets which are not included in the trust will be poured back into the trust at the time of the individual’s death.

Pay on Death Accounts

If you have maintained money in banks or other financial institutions, you can designate that upon your death all of the assets in the account be paid over to an individual of your choice. When you pass, the individual named on the account needs to provide a valid, original death certificate to prove your death and thereafter all of the funds in the account would be paid over to him or her.


The best way to avoid probate is to meet with a qualified estate planning attorney and work out an estate plan which meets your family’s needs.wills and trusts lawyer

Executors and Estates

Attorney for ExecutorsThe individual named as the executor in a Will is entrusted with the assets of the individual who drafted the Will after the individual dies. The executor has responsibilities with regard to administrating the estate, accounting for its assets, paying taxes, distributing the assets of the estate, and dealing with a variety of other issues. Executors responsibilities have not changed in recent years. However, the responsibilities have been made more complicated.

In the past an executor would go to the decedent’s home, look for documents concerning assets, try to ascertain whether there was a safety deposit box, and by and large was usually able to locate documents that enabled him or her to determine what the assets of the estate were. This is no longer the case today. Many individuals maintain all of their financial documents online. An executor would usually not know the password or user names which would enable him or her to be able to get into these accounts. Obtaining access to a decedent’s digital information has become a major problem facing executors.

Easing Burdens and Responsibilities of Executors

The best way for an executor to ease his or her burdens is to hire a law firm which has a team of attorneys, accountants, paralegals, and other individuals who can help him or her carry out the responsibilities of an executor.

The following are a list of some of an executor’s responsibilities:

  • Probate the Will: The executor needs to find the Will, hire an attorney, and see to it that the Will is probated.
  • Collect assets: The executor must identify, collect, value and manage and safeguard all of the estate’s assets during the period of time the probate proceedings are making their way through the courts. This can include bank accounts, stocks, bonds, items in safety deposit boxes, household and personal effects, as well as out of state property, out of country property, digital assets and other items such as the decedent’s interests in other estates, trusts or litigation pending in the courts.
  • Filing tax returns: The executor must prepare and file all necessary estate tax returns.
  • Pay the debts and expenses of the estate: The executor must determine who the creditors of the estate are and see to it they are paid.
  • Distribution at the end of the estate: The executor must see to it the assets are appropriately distributed pursuant to the terms of the Will.


Executors have numerous responsibilities which should be taken seriously. These responsibilities in the digital age have become more complicated to carry out.New York Estate Planning Attorney

Benefits of a Trust

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Elliot S. Schlissel is a member of the National Academy of Elder Law Attorneys.  He and his associates have more than 100 years of combined experience representing clients in all aspects of estate planning.  He can be reached for consultation by calling 516-561-6645 or 718-350-2802, or by sending an email to schlissel.law@att.net.

Issues to be Considered When Drafting a Will

If you are born, you will die. It is a fact of life. Writing a will is not something most individuals look forward to. However, responsible individuals who want to simplify the lives of their children and other loved ones write wills. A will can help you be sure your assets will go to the persons you want to receive them. A will can ensure if both you and the other parent die, your children will be raised by those individuals you want to raise them. There are certain issues in wills people seem to overlook. The purpose of this article is to bring some of these issues to light.


Imagine you and your spouse are in a car. You get hit by a truck and you both die. Dying from an accident can happen at any time. Accidental deaths are unlike illnesses. Illnesses usually come on slowly and kill you slowly. Accidents kill you quickly!

Who Raises Your Children If You Die?

So both you and your spouse are dead, now who raises your children? If you do not write a will and name someone as the guardian of your children in the event you and the other parent die, the State of New York will determine who raises your children.

You know who will have your children’s best interests at heart. You are the most qualified person to appoint someone to raise your children if you die. Writing a will and naming a guardian for your children in the event of your death can give you peace of mind and allow you to fulfill your parental responsibility to protect your children.

Do I Need a Trust?

A trust may be the best way for you to make sure your home, the money you have in the bank, your stocks, your bonds, the money you have in life insurance, your 401(k) and/or your pension go to your children in a manner which utilizes these funds for the children’s best interests.

Let’s start with the proposition minors cannot inherit. Your children cannot receive any of your assets until they are 18 years old. If you don’t write a trust, and you name your children as beneficiaries in your will, they will receive your assets at the age of 18. 18 year olds are not in a position to handle significant amounts of money!

The best way to see to it your funds are distributed in a manner which is appropriate and that these funds are not wasted, is to set up a trust and a scheme in the trust to distribute your assets over time. The difference between money received pursuant to a will, and money distributed pursuant to a trust, has to do with the fact an 18 year old in a will, will come into your funds in a lump sum basis. Whereas funds distributed pursuant to a trust are paid out over a period of time to cover expenses you designate are appropriate utilization of your funds. New York estate planning attorney

Philip Seymour Hoffman Disinherits His Children

estate planning attorneyIn February 2014, Philip Seymour Hoffman died. He had written a will in 2004. His will left all of his worldly assets to his “friend and companion” Mimi O’Donnell. Mimi was the mother to his three children. Mr. Hoffman’s lawyer and his accountant had made recommendations to create trusts for his children. Mr. Hoffman rejected their suggestions. He told them he did not want his children to become “trust fund kids.” To avoid spoiling his children, he intentionally left all of his assets to his girlfriend, Mimi. Prior to his death Mr. Hoffman met with his attorney to discuss his estate plan. During that interview, he again articulated his objections to setting up trusts funds for his children.

Hoffman Never Married

Hoffman never married Mimi. He had a long standing relationship with her and he trusted her. In a report submitted to the court by an attorney appointed to represent Mr. Hoffman’s children’s interests, the attorney stated Mr. Hoffman “simply did not believe in marriage but that did not affect his affinity or relationship for Ms. O’Donnell.” Hoffman’s lawyer stated Hoffman told him he wanted his son to be raised in the city with art and culture. On page 13 of Mr. Hoffman’s will it stated “it is my strong desire, and not my direction to my guardian, that my son Cooper Hoffman be raised and reside in or near the borough of Manhattan in the State of New York, or Chicago, Illinois, or San Francisco, California.”

Hoffman stated in his will “the purpose of this request is so that my son will be exposed to culture, arts, and architecture that such cities offer.”

Academy Award Winner

Philip Seymour Hoffman had obtained an academy award for his role in portraying Truman Capote in the movie Capote. He had also received three other academy award nominations. He was well respected as an actor’s actor by his peers. At the time of his death he was found on the floor of his apartment with a needle containing heroin in his arm. Investigation of his death uncovered fifty additional envelopes containing heroin in his apartment.

His death was a tragedy for all of the actors, directors, and other individuals in the movie industry who worked for him, with him and for his family.estate planning and trust attorney on Long Island

Reforming a Trust

new york wills and trusts lawyerSurrogate Rita Mella, sitting in the Surrogate’s Court in New York County, recently had a case involving the issue of reforming and/or changing a trust. In this case, the two co-trustees brought a proceeding to make major modifications to the terms of the trust. These trustees requested they be given a limited power to invade trust principal. The trust itself did not give them this power. They also sought to change the age current beneficiaries of the trust were to receive distributions of their shares of the trust. This action would speed up the termination of the trust.

Surrogate Mella took into consideration the trust was established for the benefit of a group of members of the decedents family. The trust was specifically designed to provide financial benefit to grandnephews and grandnieces. Each of them would receive a share of the trust after reaching the age of 25.

The co-trustee referred to a case called The Matter of Kern for support of their position that if the parties to the trust were in agreement, there was a basis for the court reforming the terms of a testamentary trust. Unfortunately for the trustees, Surrogate Mella disagreed with their position. She found that the case Matter of Kern did not stand for the proposition alleged by the co-trustees.

Surrogate Declines to Modify Trust

Surrogate Mella in her decision declined to modify the trust. Her holding was the intentions of the testator in drafting the trust were clearly expressed in his will. The fact the co-trustees and the beneficiaries sought to modify the terms of the trust did not establish a basis in law or judicial precedent for the court to disregard the clear and concise terms of the will that created the trust. The co-trustees’ application to reform the will was denied.

help in planning trustsElliot S. Schlissel is a member of the National Academy of Elder Law Attorneys. Elliot and his staff of attorneys draft wills and trusts and probate wills throughout the metropolitan New York area.

Trust Documents Declared Void Due to Lack of Mental Capacity

In a case before Robert Gigante, sitting in Richmond County, New York, the Surrogate Judge had set aside a trust based on the lack of mental capacity of the individual who executed the trust. One of the decedent’s children contacted a lawyer and requested the trust document to be drafted. The lawyer drafted the documents pursuant to the request of the decedent’s child. However, the lawyer never met or spoke with the decedent. The lawyer relied on the child’s statements and a letter from a physician stating the decedent was “in an acceptable mental status.”

The court took the position there were questions as to whether the decedent could understand the terms and the conditions of the trust. A hearing was held. A doctor testified he didn’t believe the decedent could read and understand a sales contract. In its decision, the court stated no rebuttal testimony or evidence challenging the doctor’s conclusions was submitted to the court.

The court found the decedent lacked the requisite mental capacity necessary for the purpose of executing the trust. The court therefore set aside the trust.

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