My special needs child is about to turn 18 – What should I do?

Children with special needs, who are under the age of 18, are considered minors in the state of New Jersey. Until then, parents have full authority to act on behalf of their child(ren) when it comes to making important decisions. But once the child turns 18, parents are often caught off guard when they discover that although the child continues to be dependent on his or her parents long after they turn 18, parents no longer have the same authority as before, as the children are now deemed adults under the eyes of the law. Financial, legal, and healthcare decisions can no longer be made as before, and in the unfortunate situation when one or both parents pass away, assets passing to the child as an inheritance could trigger adverse consequences if the child has been receiving critical government benefits.

So what can you do now to avoid a disaster from occurring?

As a first step, you will need to begin the process of a guardianship (typically, this should be started a few months before the child turns 18). This involves filing a Verified Complaint with the courts, requesting your (and your spouse, where applicable), appointment as legal guardian of your child.  While it is rare for a judge to deny guardianship to a parent, the formalities of the guardianship process still need to be adhered to. 

The application must include, among other things, certifications from two physicians (one of these could be made by a licensed psychologist). The court will then appoint an attorney to conduct an investigation of the interested parties and then prepare a report for the judge, either confirming or rejecting the appointment of the Petitioner. Finally, a hearing is conducted before the judge, so all relevant parties can appear and be heard in court. Once the judge approves the appointment, a final judgment containing the decision is circulated to all parties. 

At this time, the parent(s) will need to appear at the surrogate’s office to become qualified and collect their Letter of Appointment. Be prepared to incur some expenses associated with the filing fees and legal costs, especially if you choose to go with private attorneys for both the submission of your application (as opposed to going pro se) and for the court appointment. Depending on the situation, a court may also be able to appoint an attorney from the Public Defender’s office at no charge to the parents, but this could delay things a bit. A final judgment signed by the judge at the end of the proceeding will then grant you the right to procure Letters of Guardianship.

The next step is to consider whether or not you want to set up Special Needs Trusts (SNT) for your child. Here you have an option to set up (1) a first-party special needs trust and/or (2) a third-party supplemental needs trust as stand-alone trusts. These trusts can hold assets of your child’s or assets passing from you, respectively, without jeopardizing your child’s government benefits. These assets are meant to supplement, but not supplant, any other benefits so your child can have an enhanced quality of life without concern that the critical benefits provided by the government would be denied.  

Finally, you should definitely consider setting up or updating your own existing estate plan to ensure that all of your assets passing to your child upon death are protected by either having the assets pass into the stand alone SNT that you set up (see above paragraph), or have it pass into a SNT under your Will. It is  important to consult with the estate planning attorney as to which trust should hold the inheritance.  Inadvertently naming the wrong SNT could result in having the assets inside of the trust going to the estate, instead of the family or other heirs.  

Getting Documents Signed Amid Coronavirus Precautions

During this time of worldwide uncertainty, many of us are facing huge portions of our lives suddenly being moved online. Telecommuting has proven that we can do plenty of our daily activities from home—but there are still limitations. Historically, the signing and notarization of estate planning documents is not something that can be done without all participants sitting together at a table with the physical documents between them. In many places and for many kinds of documents, this is still true, but remote online notarization is a practice that is gaining more recognition.

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In New York, Governor Cuomo recently signed an executive order amidst coronavirus precautions allowing the use of remote online notarization statewide; this is an unprecedented usage of executive orders.1 Some have called for guidance from the highest state courts regarding this action, seeking assurance that the order will be allowed to stand before its validity is confirmed. At the same time, other states are considering the option to take similar measures in order to respond to the spread of coronavirus worldwide—these orders may have even been signed by the time of this reading.

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For a few weeks, New Jersey lagged behind many states who had already jumped on the bandwagon. Both houses of the New Jersey state legislature debated whether “certain notarial acts” could be performed remotely since mid-March, but it took until nearly a month later for an Act to be signed into law. On April 14, Governor Murphy signed a bill into law that allows for certain kinds of remote notarization during the Public Health Emergency and State of Emergency declared by the governor in Executive Order 103 of 2020.2 Frustratingly, this Act excludes the signing of wills and codicils. However, it is at least applicable for matters such as the creation of HIPAA waivers, healthcare directives, and powers of attorney.3 Firms have developed creative strategies to sign estate planning documents during the past month of waiting to hear whether the bill would pass; now that we have a path forward, we can use remote online notarization in conjunction with these strategies to ensure that we continue to serve our clients’ needs without face to face conference room type meetings.

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Overall, 23 states have approved remote online notarization in some capacity, though the requirements and breadth of this ability differ from state to state. Efforts are underway to establish federally recognized remote online notarization.4 The SECURE Notarization Act is a proposed bill in the Senate that aims to do exactly that, legalizing remote online notarizations nationwide—possibly immediately, should it be passed. Currently, the text of the bill is not available, but a summary of the bill indicates that it will provide minimum security standards for the usage of remote online notarization as well as provide certainty for recognition of online notarization between states. States would continue to have the flexibility to implement their own remote online notarization standards above the federal baseline.

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As with many other things during the unfolding COVID-19 outbreak, the status of New Jersey’s remote online notarization is still uncertain as the situation continues to unfold. If you are concerned about how best to get your documents executed within the state during this time, the best thing you can do is speak to a specialized estate planning attorney who you can trust to evaluate your options and explain what options may potentially be on the way in the coming days to look out for. Here at Rao Legal Group, LLC (“RLG”) we are utilizing phone calls and video conferences to continue to provide our clients with the outstanding service we are known for while keeping the distance necessary to protect our communities. We are available to help you—call us today to learn more about how we can help you prepare for the future at a time when it’s more important than ever to do so.

 

  1. 1. https://www.governor.ny.gov/news/no-2027-continuing-temporary-suspension-and-modification-laws-relating-disaster-emergency
  2. 2. https://www.njleg.state.nj.us/bills/BillView.asp?BillNumber=A3903
  3. 3. https://www.njleg.state.nj.us/bills/BillView.asp?BillNumber=A3864
  4. 4. https://senatorkevincramer.app.box.com/s/baz8p9czm0bijkicxbeb7mb7cxby7mio

Incapacity Planning

It’s hard to believe that the holiday season is well behind us and we are into the first week of February!  This post was originally scheduled for a January submission but due to a recent good interruption last week (my attendance at the Heckerling Conference on Estate Planning in Orlando, Florida), there was a slight delay.  Stay tuned for my musings of the conference in the coming weeks.  Thank you!


We all know that people download Wills off of Legal Zoom thinking that “some” plan in place is better than none at all; rather than incur the expense of engaging an attorney, their thought is to come up with a quick solution to ensure their family’s protection.  The problem with this approach is that one may actually be causing more harm than good.  For ex. if all a person created was a Last Will & Testament, then what happens if that person got hit by a truck and went into a coma for several months or years?  What does the family do when they need to pay bills, run the household or just take care of the incapacitated person?  Any good estate planning attorney will offer as part of the estate planning package along with a Last Will & Testament, a broad and robust Financial Power of Attorney as well as a Health Care Directive naming an Authorized Representative to make decisions upon incapacity.

 

Okay, so I know you are thinking: “Fine – I’ll just download these Powers of Attorney and I am all set.   From what you say, these documents are all I need to cover me then, right?”  Not so fast!  Drafting your own legal documents with the help of Legal Zoom or other online software tools is like trying to fix your car using a manual.  I don’t know about you but I know I will not get very far fixing a carburetor using a manual.

 

There are specific powers in a power of attorney that we look for when we help families – from the Medicaid planning perspective, I am looking for certain powers of the agent to help an aging parent or spouse set up trusts or apply for government benefits; for banks, I want to ensure that the agent has all of the proper authority under the document that banks are looking for; gift giving provisions are hugely helpful where there is a taxable estate and assets need to be transferred out of the estate when someone is incapacitated but where death may be imminent.

 

Finally, most people are clueless when you talk to them about the difference between probate and non-probate assets.  To give you some perspective – let’s talk about a widowed surviving spouse who takes it upon himself to draft all of the required documents discussed above and gets them properly signed, witnessed & notarized.  And let’s also say that this individual was savvy enough to ensure that his two minor children do not get the assets from his estate outright but rather he designed the Will to put those assets into a trust for his children until age 30.  Now let’s assume that this individual has a primary residence that he owns “joint tenants with a right of survivorship or JTWROS” with his brother and the only other asset he has is a significant life insurance policy where he has named his children as primary beneficiaries in equal shares on the designated beneficiary form.  Imagine this individual’s surprise when he is told that his beautifully designed Will cannot work as intended because at his death, these assets would bypass the Will and be handed to the named beneficiaries directly!  These are red flags that a good estate planner will point out and take it upon himself or herself to ensure that the documents are designed in a way that fulfill the Testator’s objectives.

 

It’s difficult to understand the work estate planning attorneys do on the back-end.  Although I have heard people stating this quite often, good estate planning is never about simply “copying & pasting” or using “boiler-plate” documents.  Each family’s situation is unique and even the most straightforward family situation may present nuances that are unique only to that family.  My job is to ensure that you or your family never have to spend wasted money undoing mistakes and hopefully never have to enter a court of law to contest or dispute the provisions contained within the documents.