Legal and Financial Issues

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Once my disabled child becomes an adult, can I continue to oversee his or her care?

All adults are entitled to make their own decisions. Some adults with special needs need help making certain decisions, but can still make others on their own. Some are not able to make decisions at all. Ideally, people should be responsible for as many life decisions as possible, relying on others only for those decisions too complicated for them to manage by themselves.

Supported decision making is one way of helping your adult with special needs making decisions. In this model, your adult retains the right to make his or her own decisions, but agrees to get support during the decision making process.  Click here for information about supported decision making models.

When your family member with special needs reaches his or her 18th birthday, you can continue to oversee his or her care by applying for  Conservatorship.

Conservatorship is a legal proceeding where an individual or agency (Conservator) is appointed by the court to be responsible for a person, 18 years or older, needing assistance (Conservatee). Seeking conservatorship can have a big impact on the lives of both the conservator and the conservatee. It is important to understand all of the implications before undertaking the process.

LAJAC-couple1In California, the most common types are:

General Conservatorship

A general conservatorship is when a judge appoints a responsible person to oversee every aspect of another adult’s life including:

  1. Housing
  2. Medical decisions
  3. The right to enter legal contracts and to access confidential documents
  4. Education or job training
  5. Appropriateness of social and/or sexual relationships
  6. Consent to marriage
  7. Financial decisions

 Limited Conservatorship

A limited conservatorship is when a judge appoints a responsible person to oversee certain aspects of another adult’s life while allowing that adult to remain responsible for other areas of function.

There are two kinds of limited conservatorships:

  1. A limited conservatorship of the person – The conservator cares for and protects a developmentally disabled adult and provides for his or her needs associated with daily life.
  2. A limited conservatorship of the estate – The conservator handles the conservatee’s financial matters, such as paying bills and collecting income.

Other Legal Tools

Power of Attorney for Healthcare

This is a legal document that allows high-functioning adults with developmental disabilities appoint a responsible person to speak with medical care providers on his or her behalf.

Durable Power of Attorney for Finances

This is a legal document that allows high-functioning adults with developmental disabilities appoint a responsible person to oversee legal and financial decisions, such as paying bills or signing contracts.

Representative Payee

This is a person or organization appointed by the Social Security Administration to help another person manage SSI benefits. The representative payee can be a family member, nonprofit agency, friend, or Regional Center Service Coordinator.

Letter of Intent

This is a letter written by the caregivers of an adult with special needs that can be used for guidance should someone else have to provide care. It is not a legal document, but can provide important information about all aspects of the adult’s life. The Arc of East Middlesex, a nonprofit assisting people with disabilities and their families, offers a free booklet to help you with the writing process.

Bet Tzedek’s Limited Conservatorship Guide  includes detailed information about Conservatorships, Powers of Attorney, Representative Payees and Letters of Intent.

Bet Tzedek’s Guide to Mental Health Conservatorship contains important information for those seeking conservatorship for an adult affected by mental illness.


How does my child’s limitation for holding assets affect my financial planning?

Long-term financial security is a particularly serious concern for families with a member who has special needs. When a child is young, the day-to-day financial demands can be huge. Because public benefits usually do not cover the entire cost of living when that child becomes an adult, as parents age and pass away there is concern about meeting that adult child’s needs for the remainder of his or her lifetime.

*Please note that your adult child cannot have more than $2,000 of savings while receiving public benefits. It is important to consult an attorney, accountant and/or your case manager to be sure assets are properly managed.

The World Institute on Disability published a free book called, “EQUITY: Asset Building Strategies for People with Disabilities, A Guide to Financial Empowerment” that is full of practical tips and information for building your adult’s financial future.

For information about interest-free loans for emergencies, education, healthcare, life cycle events and beyond, contact Jewish Free Loan Association.

Click here for a worksheet to help your adult with special needs understand budgeting. LAJAC-bank

Long-Term Financial Tools available 

Special Needs Trust - A trust is a legal document that provides a way for someone to take care of assets, including money or property, for someone else. A trust ensures the assets your adult child receives will not be considered income, which safeguards his or her ability to receive public benefits.

There are two types of trusts:

  • Private Trust – This is a trust set up by an adult with special needs, parents or another caretaker with a specific person identified as the beneficiary. There are several benefits to a private trust, including control of investments and disbursements. However, individual private trusts can be costly to establish and maintain.
  • Pooled Trust – In contrast, a pooled trust combines the assets of many beneficiaries in order to make more stable investments. It provides additional management services, and it is overseen by a nonprofit organization. While serving a whole community, these pooled trusts can provide individual families an efficient way to manage administrative costs while ensuring an adult child’s access to government benefits.

There are different benefits and potential drawbacks to each type of trust. Expert advice from an attorney, accountant, or financial planner who has experience with special needs is vital.

Click here for more information about the Jewish Los Angeles Special Needs Trust.

ABLE Accounts – These are tax-advantaged savings accounts for individuals with disabilities and their families. The funds in these accounts are usable for: healthcare, housing, transportation, employment training and support services, assistive technology, personal support services, education, financial and administrative services and other expenses improving the independence and quality of life for people with special needs.  The maximum annual contribution allowable is $14,000.

Social Security Income (SSI) benefits will be suspended for the beneficiary if the account balance exceeds $100,000, but they will be reinstated once the balance is below that threshold. The suspension of SSI benefits will not affect Medi-Cal. When the beneficiary of the account passes away, the state will be able to recover funds from the account for past Medicaid expenses. The legislation governing these accounts in California is still under consideration.

Each state will either create their own version of an ABLE account, or contract with another state for participation. Eligible participants will be able to open accounts in any state with an ABLE program allowing interstate participation.

STABLE accounts are now available in Ohio.

Tennessee is now offering ABLETN accounts.

Nebraska launched their ENABLE accounts on June 30th.

Programs are also expected to launch in Virginia and Florida as well. However, accounts in Florida will only be open to state residents.

The ABLE National Resource Center has detailed information about ABLE accounts as well real time updates regarding account availability.

Special Needs Trusts and ABLE accounts were the topic of a recent Knowledge is Power workshop. You can view the videos and download the presentations here.

A fact sheet describing the different financial tools available for adults with special needs is available here.

For more information about legal and/or financial issues, click here to be connected with an LAJAC Case Manager or Intake Specialist.

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