Florida Special Needs Law Blog

Disability Savings Accounts - H.R. 1205

David Lillesand — Fri, 06 Mar 2009 02:03:26 -0500

Congratulations and a big thank you to our Florida Congressmen, Ander Crenshaw and Kendrick Meek, who have introduced legislation to allow families to plan for their loved ones with some significant tax saings. Information on the bill follows. To see the bill in its entirety, click on H.R. 1205.

Disability Savings Accounts

The bipartisan Achieving a Better Life Experience Act of 2009 (ABLE Act), H.R.1205/S. 493, was introduced in both the House and Senate on February 26. The bills would allow individuals and families to establish special accounts for meeting the future needs of children and adults with disabilities. Funds in the accounts and expenditures which meet the requirements of the bills would not affect the individuals' eligibility for federal benefits. Using these accounts, parents would be able to save funds for a child's future in a manner similar to the special "529 accounts" currently used to save for a child's future educational expenses. The House bill was introduced by Rep. Ander Crenshaw (R-FL) along with Representatives Patrick Kennedy (D-RI), Cathy McMorris Rodgers (R-WA), and Kendrick Meek (D-FL). The Senate bill was introduced by Senator Robert Casey, Jr. (D-PA) along with Senators Sam Brownback (R-KS), Richard Burr (R-NC), Christopher Dodd (D-CT), Orrin Hatch (R-UT), and Edward Kennedy (D-MA). The bills were referred to the House Ways and Means and the Energy and Commerce Committees and to the Senate Finance Committee. The Arc and UCP worked with the sponsors and with other supporting organizations on development of the bills.

Florida Special Needs Trusts

David Lillesand — Sun, 15 Feb 2009 00:04:48 -0500

Special Needs Trusts in Florida and around the nation will be impacted by the new POMS on Special Needs Trusts issued in January. The March meeting of the Academy of Special Needs Planners will have top experts discussing the changes, and other important information on Special Needs Trusts. If you are an attorney, plan to attend. You can register at the Academy's website, http://www.specialneedsplanners.com/.

New POMS on Special Needs Trusts

David Lillesand — Sat, 14 Feb 2009 18:29:36 -0500

The Social Security Administration published new POMS, the staff operating manual, on Special Needs Trusts. As Chair fo the Special Needs Trust Committee of the Florida Bar's Elder Law Section, I have set a meeting to review the new POMS in detail for March 19th, in Tampa.

Here's a "CLEAN COPY" of the new 2009 POMS on Trusts.

I also prepared a word-by-word analysis of the 2009 changes from the original 2001 POMS. Deletions are indicated by striking through the word, and additions by underlining. See "THE CHANGES HERE." See also the 5 PAGE MEMORANDUM that highlights the changes.

Generally, the POMS are claimant friendly, although attorneys who do not follow them closely, can cause some significant problems for their clients. The new POMS specifically approve of child support Special Needs Trusts and Alimony Special Needs Trusts, which will go a long way in ehlping to resolve family law disputes where continued health insurance is an issue.

SSI Regional Chief Counsel Opinion Letters on Special Needs Trusts

David Lillesand — Thu, 12 Feb 2009 23:38:20 -0500

The Social Security Administration (SSA) has provided attorneys and the general public with very useful information on their analysis of Special Needs Trusts - are you eligible or ineligible if you have such a trust. There are a lot of ways that attorneys can inadvertently cause a Special Needs Trust to be found in violation of the many SSI resource rules. While Special Needs Trusts are perfectly legal and will keep SSI benefits for disabled persons, simple drafting errors by attorneys can result in loss of SSI and Medicaid health insurance.

Fortunately, SSA is trying to help clients stay eligible by educating the public and attorneys.

Unfortunately, although the Regional Chief Counsel opinion letters, called "Precedents" in SSI-speak, are availabe as a category on the Internet in the POMS, they are poorly organized and not indexed.

The good news: attached is a LENGTHY ANALSYS OF THE RCC OPINION LETTERS issued between 2006 through 2008, with a table that summarizes the issues and the holding, and an 18 page explanatory text of the "Top Ten Things Learned by Reviewing RCC Opinion Letters" and a 6 page chart, as well as the RCC opinion letters themselves. The total package is 176 pages.

2009 Matrix Explaining SSDI and SSI Relationship

David Lillesand — Wed, 21 Jan 2009 23:13:00 -0500

A lot of people in general, and professionals (attorneys, CPAs, financial planners, social workers, and others) confuse Social Security Disability Benefits (SSDI) and SSI Disability Benefits. Also, receipt of SSDI triggers Medicare health insurance, and SSI triggers Medicaid.

It is important to understand the differences. Social Security Disability Insurance benefits can be paid to millionaires.

SSI disability benefits are paid to individuals who are disabled, but also meet two financial eligibility tests, less than $2,000 of countable resources (assets) and low monthly income. Although the $2,000 limitation seems harsh, SSI does not count a home of any value, one car of any value, the contents of the home, personal effects such as clothing and jewelry, and extra cash held in a Special Needs Trust.

To aid in seeing these relationships, we created a Matrix with updated 2009 eligibility figures.

Special Needs Trusts Questions and Answers

David Lillesand — Wed, 14 Jan 2009 23:21:13 -0500

We've updated our Q and A BOOKLET with the most common questions and answers on Special Needs Trusts as a method to legally shelter, with governmental approval, funds from personal injury awards and from inheritances.

Email us at Lillesand@bellsouth.net if you have additional questions or need more general information.

How to calculate parental deeming amounts

David Lillesand — Wed, 14 Jan 2009 22:47:41 -0500

Although it is like filling out a tax return, it is possible to accurately calculate the amount of parents' income that will be deemed against a disabled minor child's SSI and Medicaid eligibility. The attached ARTICLE ON SSI DEEMING CALCULATIONS explains how.

The FORMS FOR CALCULATING PARENT TO CHILD, and FORMS FOR CALCULATING SPOUSE-TO-SPOUSE deeming are included, along with an EXAMPLE OF CALCULATED DEEMING FOR A CHILD from the article.

Our firm does SSI deeming calculations for individuals and for bank trust officers upon request.

Deeming - 2009 SSI Breakeven Points

David Lillesand — Thu, 01 Jan 2009 12:01:01 -0500

Attached is a TABLE OF SSI DEEMING BREAKEVEN POINTS, that is, how much income a parent of a minor child, a spouse, or a sponsor of an alien, could earn and still have the disabled SSI child, spouse, or alien be eligible for at least $1 of SSI benefits. Receiving at least $1 of SSI is important in Florida, and 31 other States, since receipt of any amount of SSI benefits triggers full eligibility for Florida Medicaid pursuant to Florida Statute, Section 409.903(2) and SEction 1634 of the federal Social Security Act.

Be careful when using this chart. Note the limitations on when it cannot be used. The only way to accurately determine the amount of parents' income, for example, that will cause the loss of SSI benefits is to do a step-by-step calculation using the fairly complicated SSI income rules. We will post shortly a paper that describes, in detail, with forms, how to do that calculation. Also note, our firm does these calculations for clients and for bank trust officers who are administrators of Special Needs Trusts.

Call us if you want help.

New Gainesville Special Needs Trust, SSI and Social Security Disability Office

David Lillesand — Sat, 01 Nov 2008 23:26:34 -0500

We are pleased to announce that Lillesand and Wolasky, P.L., has opened a new office in Gainesville, Florida to provide legal services to North Florida. The practice is limited to Special Needs Trust, SSI disability and Social Security Disability Insurance Benefit Claims, and related Medicaid and Medicare issues.

We are located in the Haile Village Center, SunTrust Bank Building, Second Floor, 5303 S.W. 91st Drive, Gainesville, Florida 32608.

We look forward to assisting other attorneys and clients from our new North Florida location.

Want to know the amount of your Social Security benefit at retirement?

David Lillesand — Wed, 13 Aug 2008 00:12:24 -0500

With millions upon millions of baby boomers about to retire, the Social Security Administration has created an online "retirement benefits estimator" that is a substantial improvement over the previous Internet version. Go to www.socialsecurity.gov/estimator.

There are a number of things that are significant improvements. Unlike previous versions, this one uses your actual Social Security taxes paid over your lifetime, to calculate the benefit for you -- exactly. Secondly, it provides an opportunity to ask for different scenarios - such as, what if I retire early at age 62, or age 64, versus my full retirement age of 66. Finally, it is FAST! Two simple pages of input items (name, SSN, date of birth, mother's maiden name), and you'll instantly have the amount of your Social Security check.

With over 1 million people visiting Social Security local offices each week, anything that will cut down on unnecessary trips to SSA will benefit both individuals who need the information as well as the number of SSA employees needed to respond to requests for information.

2008 SSI Parental and Spousal Deeming Chart

David Lillesand — Tue, 12 Aug 2008 22:25:14 -0500

The new 2008 Deeming Chart should be used by banks and other Special Needs Trust Administrators judiciously. Pay particular attention to the qualifications indicating when the trust may not be used, which appear at the end of the chart. Also be aware that these numbers increase annually, but a slight amount, due to changes in the SSI Federal Benefit Rate.

However, the chart is definitely useful to indicate approximately how much a parent could be paid, for example, for disabled child caretaking, to stay within the deemed amount that will not eliminate a child's SSI disability benefits. In 31 U.S. states and jurisdictions, receipt fo $1 of SSI triggers automatic eligibility for state Medicaid benefits.

FSGA presentation on Social Security, SNT, and Medicare Changes

David Lillesand — Sat, 09 Aug 2008 13:17:31 -0500

The organizers of the Florida State Guardianship Annual Convention asked me to prepare some comments on Social Security, Medicare and Medicaid - It Just Keeps Changing. The ten page paper highlights changes in how attorneys and guardians of disabled individuals will have to change the way they interact with SSA, video hearings, "paperless" medical and legal files at SSA, as well as the 2008 changes in Medicare, and changes we are expecting in the SSI POMS that relate to Special Needs Trust administration: new rules on employment by the trustee of parents to care for minor disabled children, support of dependent spouses and minor children using the disabled parent's trust funds (see our previous post on July 11th), and structured settlement annuity problems, particularly with deeming of healthy parents' annuities against the disabled child's continued eligibility for SSI and Medicaid.

If you want more information on guardianship, or the Florida State Guardianship Association and an application for membership, click here.

Special Needs Trust "Sole Benefit Rule" and Support of Spouse and Children

David Lillesand — Fri, 11 Jul 2008 12:48:54 -0500

There are no clear instructions from the Social Security Administration on whether a trustee of a Special Needs Trust can use a disabled person's d4A Special Needs Trust to support a healthy spouse and dependent children.

For statutory and policy reasons, we argue, not only can a trustee use a disabled beneficiary's self-settled SNT funds in the appropriate circumstance to support these dependents, but failure to do so may have criminal consequences.

See our six-page Thoughtson the matter, attached, which reference the federal and state statutes that apply to this issue.

Worker's Compensation benefits and SSI

David Lillesand — Thu, 10 Jul 2008 21:10:48 -0500

An attorney asked us, "How does the Social Security Administration treat Worker's Compensation benefits for SSI eligibility purposes?"

WC weekly wage replacement payments. The SSI financial eligiblity rules require that a claimant have low income and few assets, which they call "resources." Weekly worker's comp wage payments are treated as "unearned income" for SSI monthly income eligibility purposes, and except for a $20 general income disregard, the full amount of the worker's comp payments are subtracted from the potential full SSI benefit of $637. Thus, an injured worker who receives worker's comp payments of $657 or more in a month, would not be eligible for SSI for that month. See the SSI federal income regulations on unearned income. Whether the income stream from WC payments can be irrevocably assigned to a Special Needs Trust, is a matter of state law that varies from state to state. The SSI POMS at SI 01120.201.J. do NOT list WC payments as income items that cannot be assigned to a trust.

WC Wash-out Settlements. Sometimes workers "wash out" the settlement, taking a lump sum and foregoing any additional payments from the worker's compensation insurance company. These settlements can range from a few thousand dollars, to hundreds of thousands, depending on the seriousness of the injury. The SSI rules would treat the lump sum settlement as "income" in the month received, probably knocking out SSI and SSI-related Medicaid eligibility for the month of receipt of the settlement check. However, what happens next? Teh retained funds become a resource (asset) that is usually over the $2,000 limit. If the worker keeps the settlement money, and the amount is over $2,000, SSI eligibility is lost, and SSI-related Medicaid is lost, UNLESS the worker places the funds in a Special Needs Trust. A trust will solve the problem.

Stetson Special Needs Trust Conference

David Lillesand — Thu, 10 Jul 2008 18:50:21 -0500

I will be presenting at both the Basics and the Advanced sessions of the Stetson College of Law Program on Special Needs Trusts. This is the 10th Annual program, and has become "the" national program for basic and advanced continuing legal education on Special Needs Trusts. If you are a professional in the field, either an attorney who drafts Special Needs Trusts, or a Trust Officer who administers them, this is the best program to attend to stay abreast of developments in SNT law. Here's the AGENDA and here's the REGISTRATION information for the October conference. See you there!

New POMS Rule on Special Needs Trusts - Atlanta

David Lillesand — Tue, 24 Jun 2008 18:45:47 -0500

Social Security Region 4

Good news! One of the tasks of our Florida Bar Elder Law Section's Special Needs Committee which I co-chaired this year, was to petition the Social Security Administration to change the Atlanta Regional POMS on Trusts. Specifically, we wanted recognition that the Doctrine of Worthier Title no longer applied in Florida. The Atlanta Regional Office of the Social Security Administration publishes the instructions to Florida SSA staff on interpretations of Florida law.

Our petition was adopted, and a new Atlanta Regional POMS styled "SI ATL01120.201 - Trust Property," was published by SSA on the Internet on April 15, 2008.

The Doctrine of Worthier Title had previously made irrevocable trusts into revocable trusts, automatically by operation of law, whenever the trust document failed to name a specific residual beneficiary. This caught many Florida drafters of Special Needs Trusts by surprise. For a Special Needs Trust to be valid under federal SSI rules, and thus trigger SSI-related Medicaid in Florida, the trust must be irrevocable. A previous attempt by our law firm, through litigation in the federal courts, was unsuccessful in persuading the courts that Florida had abandoned the Doctrine through case law. Thus we sought an administrative remedy by petition.

That problem has now been corrected. Life is good!

What's the relationship between SSDI, SSI, Medicare and Medicaid

David Lillesand — Mon, 23 Jun 2008 03:19:48 -0500

The four major programs fall nicely into a Matrix: the two columns are the monthly SSA payments (either RIB/DIB or SSI) which trigger the two major medical programs, Medicare and Medicaid. The two rows indicate which two programs are insurance-based (RIB/DIB and Medicare) and which two are welfare programs with monthly means-testing for income and assets (SSI and Medicaid).

Some individuals get benefits from all four programs, called "Current Benefits" represented by the circle in the center of the Matrix.

We have attached a full explanation of the eligibility requirements for RIB and DIB, which trigger Medicare health insurance, and for SSI which triggers Medicaid eligibility.

How SSA decides and processes a disability claim

David Lillesand — Fri, 20 Jun 2008 02:06:01 -0500

If you've ever wondered how the Social Security Administration decides whether a person is disabled, look here.

If you've wondered what are the steps to get disability, look here, and note the length of time between each step.

If you're absolutely bewildered by the length of time it takes to get a hearing before a federal Administrative Law Judge, read some of the entries on NOSSCR's collection of news and editorials on the scandal (scroll down on the web-page to see the articles). Last year, SSA judges heard 550,000 cases. Unfortunately, the backlog grew to 750,000 severely disabled people waiting to get a hearing.

In the 1990's we had a system in place that moved the cases much more quickly. But that was before all the tax cuts and then the staff cuts - eliminating or not replacing judges, secretaries, and other staff. We are now operating with a Social Security staff workforce that is the same size as when John Kennedy was president, and the population was 179 million, not the 304 million we have now.

You can't have a hearing without a judge. And a judge can only hear 15-20 cases per week. Less judges means long, long delays waiting for a judge to be assigned and your hearing to be scheduled by SSA.

More funding, more judges, more judges, less delay in getting a hearing. Write your congressman!

Same Sex Marriages? SSA in a panic!

David Lillesand — Tue, 17 Jun 2008 23:46:00 -0500

On May 15, 2008, the California Supreme Court legalized same-sex marriages. The ruling took effect on June 17, 2008. On June 6th, the Social Security Administration issued EM-08061, an Emergency Message telling the 61,000 member staff to "wait for instructions" before answering any questions about the effect of the ruling on certain Social Security benefits accorded to spouses.

For example, SSI rules provide that a disabled or elderly person's financial eligibility for SSI benefits depends on having low income. Four types of income are considered: earned (generally, wages or net self-employment income), unearned income (savings accounts and other investment income), in-kind support and maintenance (someone else providing food and shelter), and deemed income, the earnings of a spouse that are regarded as being available to the disabled or elderly spouse.

Will they count the income and resources of a same-sex spouse to deny benefits to a disabled partner?

The administration has not felt restrained in using the law to the disadvantage of non-traditional heterosexual couples. For example, most states, like Florida in 1968, abandoned "common law marriage" between a man and a woman. Indeed, SSA has denied Title II regular SSA spousal retirement or disability benefits to heterosexual partners who did not have a marriage license, but if the person sought Title XVI SSI benefits, denied them on the grounds they were holding out to be a husband and wife. So basically, SSA said that to get money from us on Social Security taxes you paid, we regard you as NOT married, but to get money from us for SSI benefits, we again deny you but regard you as being married.

The ruleapplied only to a man and a woman in a "holding out" alleged marital relationship. It created the anomaly that a heterosexual man and woman holding themselves out to be husband and wife were denied benefits, but a same-sex couple in a husband and wife relationship were approved for SSI.

Now, will the administration recognize under federal law that benefits should be denied to same-sex couples? If they deny SSI benefits to same-sex couples, this administration will be admitting that the same-sex couple are "married." Ah, hoisted on the petard of the Defense of Marriage Act!

Presentation for Academy of Special Needs Planners

David Lillesand — Sun, 15 Jun 2008 23:18:14 -0500

The first week of July, we will be presenting a "webinar" (an Internet Seminar) for members of the Academy of Special Needs Planners on the POMS and how to use them. "POMS" is an acronym for the "Program Operations Manual System," the Social Security Administration's staff manual for its 61,000 employees. In preparation for the seminar, I expanded the presentation outline of official SSA websites into word document, and organized them by general legal citations (statutes, regulations, rulings, POMS) and secondary sources, such as the Social Security Handbook and other materials published by the agency for public use. I hope you find it useful.

If you are an attorney and want to join a terrific organization that focuses on helping severely disabled children and adults, and helping their families plan for the future, shelter personal injury or medical malpractice awards, join ASNP- the Academy of Special Needs Planners.