Special needs planning requires specialized knowledge to help families plan their legacy for a special needs child (or beneficiary), without jeopardizing the child’s eligibility for certain, necessary benefits. In this post, I am pleased that my mentor and friend, Candace Pollock, agreed to guest post on Ohio Estate and Special Needs Planning. She is an attorney and author on estate planning topics, particularly special needs planning:
For many families and their advisors, a Last Will and
Testament is considered an essential legal directive. However, in this day and age of
‘payable-on-death’ accounts on top of Joint Tenants With Rights of Survivorship
(JTWROS) property, it is more common that the Will is not used to pass assets
to survivors. Therefore, the baseline planning
question should always be: What property, if any, will be controlled by
my Will? This is particularly important for families
with a special needs beneficiary since the Will is the document most people use
to give detailed instructions for managing assets that pass to the special
needs beneficiary. Beautifully crafted
instructions in a Will can all be for naught if no property passes via probate.
Therefore, everyone should understand the
three assets categories to understand how the assets pass to survivors:
- Probate: applies when title is held by one person with
no payable-on-death feature. This is true whether the owner had a Will or not;
- “Operation of Law”: assets exist when
state law provides that named survivors automatically gets the asset at the
owner’s death. JTWROS or Transfer on
Death (TOD) assets are examples; and
- Contract: assets pass according to the
contract terms or beneficiary designations.
Probate will always be the default method of transfer if the other
methods can’t apply due to the owner’s failure to name a beneficiary or the beneficiary
dies prior to the owner. Therefore, it
is important to have a Will as “safety net” to catch assets that can’t pass via
the other methods as long as the owner understands the role it might and might
not play overall.
they own title to assets to determine if their assets will pass via a Last Will and Testament as well as coordinate the
other methods accordingly.
also consider using a Living Trust as an alternative to relying on a Will to
plan for such beneficiaries.
Candace Pollock is a partner is Hahn & Pollock, LLC., in Cleveland, Ohio. She can be reached at www.hahnpollock.com. Ms. Pollock has authored several books, including co-authoring “Special People, Special Planning: Creating a Safe Legal Haven for Families with Special Needs,” available at www.legacyplanningpartners.org.