What You Must Really Know About Special Needs Trusts:

Session 2--- So, You Have a Special Needs Trust – Now What?

Presenter: Steven C. Rhatigan, Principal Archer Consulting Group, LLC

1717 St. James Place ■ Suite 205 ■ Houston, Texas 77056 ■ 713.572.1717 Main ■

713.572.1723 Fax 1054 Canal Blvd ■ Suite 2 ■ Thibodaux, LA 70301 ■ 985.227.4019 Main ■ 985.655.9030

Fax

At Archer Consulting, we design, implement and manage lifetime care plans for people with unique needs. We carefully coordinate each person’s legal, medical, financial, governmental, vocational, residential and educational requirements into a rational and viable plan. This unified approach eliminates much of the frustration so many families encounter when caring for a person with lifetime care needs, and assures that their loved ones receive access to the level of services they deserve…for a lifetime.

Notification Archer Consulting Group, LLC. does not offer legal advice or services. No one here is an attorney, nor is anyone likely to become one. None of the following information is intended to replace, supplant, usurp, supersede, or in any way cause your attorney to become aggravated by its contents. We merely wish to provide you with good information and the motivation to use it properly in your planning efforts.

What We Do

Caregivers

Child

Risk Management

Bank/ Financial

After Tax

DI Ins

Life Ins

LTC

Trustee

Residential

TPAM

Special Needs Trust

Wills

POA Tax

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Letter of Intent

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Benefits

IRA

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CPA

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Caregivers

Child

Trustee

TPAM

Special Needs Trust

Health POA

POA

Estate PlanGuardianship

Trust Advisor

WILLS

Legal

Planning Board

Letter of Intent

Letter of Instruction

The Special Needs Trust

3rd Party SNT

Funds that are from a third

source; not the beneficiary

The Special Needs Trust

Will Your Trust Operate Properly?

Beware of the “Forms” Scrivener.

The “language” of the document matter;

I. Supplant vs. supplement

II. Strict Supplemental [Benefit-centric trust]

III. Everything, plus the kitchen sink document

IV. Challenging Language = Confused Trustee

Use the Letter of Intent to Express Your Wishes.

The Special Needs Trust

When Should—Could—Would You Fund the Trust?

Many times a trust has no assets put into it until the death of the person who establishes the trust. The special needs trust is in “standby mode” waiting for a future event. At times it may be preferable to put assets into the trust and begin using the trust immediately, but immediate use is not required.

Inter vivos vs. Testamentary.

Taxes and Deductions/Credits

Additional property may be added to the Trust by the person who established it or other people including grandparents and friends. Additions may be made by gifts during life, by will, living trust or life insurance policies.

The Special Needs Trust

What Type of Assets Can Fund the Trust?

Virtually any kind of asset may be held by the trust. Holding title in the trust results from transferring the title into the trust’s name;

If the trust is to be funded with a retirement plan, it may be risky because of the minimum annual distribution rules. The beneficiary could be negatively affected for any means-tested government benefits. The trust should provide that it has the ability to accumulate the minimum annual distribution, if any.

The Special Needs Trust

Dividing Your Estate Between Beneficiaries -- Problems:

Fractional vs. Specified Method;

No Cash Flow Projections;

Inefficient Distribution because of Inefficient Assets;

No “pick and chose” Options for the Executor when Funding the Trust;

Handling Personal Property Distributions;

No Communication with Anybody.

The Special Needs Trust

This & That: Really Bad Mistakes

Drafting Third-Party Trust, When Trust Should Have Been Self-Settled --- and vice versa;

Limiting distributions to trust income only, and none from the corpus;

Requiring Mandatory and/or Regular Distributions;

Allowing the Trustee to Terminate the Trust “for any reason”; [Prior to the beneficiaries death]

No Trust Advisor or Trust Protector; [The Enforcer]

No provision to allow the trustee to modify the trust to comply with changes in the law or to comply with another state’s rules, if the beneficiary moves

The Special Needs Trust

If You Need A Little Guidance --

Action Step

Call for a no obligation meeting at our offices.

We will spend an hour or so, at no cost, to listen to your unique story to better understand your goals and needs.

You will also have the opportunity to be fully briefed on the extent of our services and how we might work with you to design, implement and maintain your lifetime care plan.

We will provide you with all the information required to make an educated decision on your next steps.

1717 St. James Place ■ Suite 205 ■ Houston, Texas 77056 ■

713.572.1717 Main 1054 Canal Blvd ■ Suite 2 ■ Thibodaux, LA 70301 ■ 985.227.4019

Main

Thanks for attending and we hope to hear from you in the

near future.

Good Bye