Special Needs Trust 101

today's topic Ryan is going to be

special needs trusts hello everybody

this is Keith Caldwell with our special

voice TV and I've got with me today

Ryan Platt Ryan say hello to everybody

introduce yourself hello everybody this

is Ryan Platt

hey I started a company called a special

needs plan approximately 11 years ago to

serve families that have a loved one

with special needs and ensuring that

they have a secure future and to ensure

that a proper plan is put together that

is coordinated and ready for action and

implementation and in ensuring that that

future is is gonna be what the family

wants thanks

again my name is Keith Caldwell I failed

to mention this last time but I'm a dad

I'm not a financial planner I'm not an

attorney I am but I'm a dad who had

questions relative to special needs

planning so Ryan and I have been doing

these series of webinars to help educate

people and myself along the way so

today's topic Ryan is going to be

special needs trusts Keith and I really

appreciate everybody sending in

questions because again Keith and i's

goal is to ensure that you receive the

information that you want to hear about

and the only way we can do that is if

you guys interact with us and

communicate what your questions are one

of the things that I noticed as as Keith

and I reviewed all the questions is many

of the questions are actually special

needs planning questions you know for

example what is the best vehicle for

securing my son's future after my

husband and I are deceased

or how to best make arrangements for the

physical care ie housing when I'm no

longer around those are fantastic

questions but those are really what are

considered special needs planning

questions not really special needs trust

questions and that's one of the

distinctions that a lot of times is not

made right we think special needs

planning equals a special

NEADS trust and unfortunately a special

needs trust is one tool to use within

special needs planning and we just want

to make sure that that we understand

that distinction some of those planning

questions we're probably not going to

get to in this webinar because this

one's going to be focused on the tool of

the special needs trust which again is

usually a critical part of that entire

special needs plan but it is just going

to be one part of it so can you break it

through and walk us through especially

the trust and what they are and how

people use them sure sure absolutely so

so a special needs trust is is a very

unique type of trust tool that has a

certain language in it that allows it to

qualify as what's called a special needs

trust so the language that the special

needs trust has is going to be different

from a regular trust and what I mean by

that is the language and the special

needs trust needs to make sure that it

discusses government benefits that it

states that it's not going to supplant

or replace government benefits but only

provide for benefits that supplement

what the government's providing your

child it's also going to make sure that

it just has one beneficiary of the of

the special needs trust it can be for

one person and so if the reason that

that language is so important and that

there's certain language and especially

is trust is because of the reason that

most families are using it most families

are using it in order to provide their

child with assets for their lifetime

support needs and so in order to do that

in order to keep qualification for

government benefits their assets can't

go just to a regular trust or to their

child directly because as many of you

know there's an asset limit to qualify

for many of these government benefits

like Supplemental Security income and

Medicaid and so when we look at that

the special needs trust is going to be

one of those exempt assets right so you

could put more than two thousand dollars

into that trust and and still qualify

for benefits as long as the money sits

in that trust and that trust has that

special language in it then it will not

be counted as an asset of your child in

regards to qualification for those

government benefits and that's a really

important distinction that's one of the

main reasons why families have it so

that they're not just leaving money to

another sibling and saying hey here's

the money you take care of your sibling

or you know many times there might be

just one child and then the family might

think well I'll just leave all my money

to them and and you know and because

they're gonna need it for their lifetime

I'll just leave it directly to them and

unfortunately when you leave money

directly to a individual that is

receiving SSI or Medicaid if that money

totals over $2,000 and it goes directly

to their name that again they're gonna

be disqualified from those government

but that's okay what kinds of is there

more than one type of special needs

trust right there are different types of

special needs trust so when when we

think of them it we kind of break them

down into three different types the

first type that we'll touch on is what's

called a d4a or self settled trust what

that one is is that is a trust

specifically designed to hold money that

is your child's money and so many of you

are thinking well my child doesn't have

any money but there are families where

their child will have an asset so for

example there may be at some point a

lawsuit or some type of civil suit where

there is a financial award and if that

is for your child that's their money and

so that type of financial piece since

it's theirs would have to go into this D

for a self settled trust for the

benefit and their benefit only because

if it didn't then that asset would be

theirs right and so they would have more

than $2,000 and wouldn't qualify for

these government benefit programs


so if it goes into that d4a trust then

they can still qualify for the

government benefits now the issue with

that is you don't if that if that's you

guys if that's anybody that's listening

you don't want to add your money to that

trust and the the reason for that is in

a self settled trust there is what's

called a pay back provision and what a

pay back provision is is when your child

passes away that money whatever is

remaining many times will go back to

Medicaid because what Medicaid does with

those type of trust now that's going to

be different when we talk about the

other ones so please that's not every

single that's not every type of special

needs trust has a pay back that's very

important to understand not every type

of special needs trust has a pay back

but this self settled one does so if

there's money left over in the trust at

the end of your child's life Medicaid

comes in and says well these are the

services we provided here's the cost

that that here's the cost of those

services and if there's if there's money

left over in that trust they're gonna

capture it to repay those costs only

only up to the amount that the benefits

were given to them yes right only up to

the only up to the cost of those

services absolutely right Keith right

yeah they're not gonna go in and take

the rest of all of it if there's more

there yeah

many times they may you know again

depending on the services your child

received but and then the another type

is a third party special needs trust and

that's gonna be the predominant one that

most everybody is going to consider

that's on the call most families are

going to consider that type of trust and

the reason is is third party the reason

it's titled that is it's third party to

your child meaning it's not their money

it's your money it's your assets it's

the home you want to put in there it's

the life insurance policy fee you want

to leave it's the investment account you

want to leave it's again whatever asset

you have that

want to put in that trust for your child

to be able to enjoy or to liquidate and

have cash available to provide them

their lifetime support needs would go

into that third party trust and again

it's going to look real similar to the D

for a special needs trust in language

maybe a little bit different but pretty

similar but the main difference is if

that trust is written correctly then

there's going to be no payback provision

to Medicaid so at the end of your

child's life Medicaid does not come in

and does not grab the money but instead

it goes to whoever you decided you

wanted it to go to within the trust

document so within the third party

special needs trust you write who you

want the remaining portion of assets to

go to in the event there are any at the

end of your child's life so many times

that maybe other children you have that

maybe future grandchildren you have that

may be a charity that you want to leave

it to if your child doesn't need it

anymore because they pass away with

money left in there

huge distinction between the two so we

want to make sure we don't mix those two

when you're moving forward there was

another question we don't usually talk

about this type of trust very often but

I'm glad we had a question on a Keith

the third type is kind of what's called

a pooled trust you know there is a

question there of that we had you know

hey I don't have a ton of money I I

don't really have a lot of family or

friends who I think could be the trustee

you know are there other options you

know in advance they said I heard there

might be some nonprofit organizations

that do that and you're right

there are so these nonprofit

organizations are called pooled trusts

now how most pooled trust work and you

really have to talk to each individual

nonprofit that runs one is basically out

of everybody members kind of elementary

school but you kind of walk in over the

long time yo exactly the only reason I

remember is because I have to go now

with my kids okay yeah on one wall

there's usually like a cubby hole right

for every kid that

walk in and put their you know their

jacket in their book bag and mmm

show-and-tell or whatever they're doing

that day and that's kind of what I

that's the kind of vision that I think

about when I think about a pooled trust

right so this company this nonprofit

will will take assets from a number of

different families for the benefit of

their child and and each beneficiary has

a kind of cubby hole right and then this

pooled trust pulls the money together to

make sure that there's a money manager

or investment company that will manage

the amount of money when it's pooled

together because most of those trusts

are too small they might be twenty five

thousand fifty thousand seventy five

thousand sixty thousand dollars where

they're not going to get the attention

of an investment or trust company who

has the experiencing managing special

needs trust which is again very

important that you manage it

appropriately when you're taking money

out of it and there are a few questions

on that as well but that's a very

important element to understand is it's

not just setting it up that you need to

make sure it's set up right - to cloth

to keep qualification for government

benefits but it's the continued use of

it and distribution and managing a

management of it while it's being used

which is most of the time when you're

gone as a parent alright so that it

continues to qualify so this company

will know how to do that because that's

what they do and so for individuals for

families that don't have maybe a family

member or anything else that they think

could be trustee and at the same time

don't have enough assets for these

larger trust companies or organizations

to help manage those dollars then a

pooled trust could be a good alternative

again the idea of it is everybody has

their own cubby so let's say Jon's fifty

thousand is here and Mary's seventeen

eighty five thousand is here it's all

kind of mingled together at the

investment company side but on the other

side what they do is they make sure they

keep an accounting and a record of how


using your child's money the benefit to

that is if the if the Trust goes to zero

in most pooled trust organizations in

please check because I never say also

please don't take that as the complete

gospel you need to talk to each each

pooled trust organization individually

and make sure it's true for them is that

they're not going to kick them out right

it goes to zero they're not going to say

we're not going to help you anymore

because what happened is Mary might have

passed away over here with 30 grand left

in her trust right and most of the time

the pooled trust have an agreement with

Medicaid that if the money stays in the

pooled trust and there's no pay back to

Medicaid the pooled trust keeps it to

help John who died with no money to keep

going right and that's the idea of the

pooled trust so most pooled trusts you

know you're also not necessarily going

to get any remainder or you get a small

amount of a remainder to other

beneficiaries like siblings or grandkids

in the line that's kind of you know for

most of the most of the cool trust

that's kind of how they would work and

that's how they you know are able to

function I'm going forward and

continually serve those individuals you

know that could be a really good

solution for some people to of modest

million right absolutely

it really is and or if you don't have I

know Mike here I'll get your question a

second Mike or you don't have a lot of

good choices for guardians and trustees

and cetera I talk to a lot of people who

for single parents with notes that their

kid has no siblings and they're

concerned about you know I don't have

anybody else to take care of my kid when

I'm gone what am I choices so this could

be something that you guys would want to

look into as a pool dress and I now I

know Mike here and I'll get to you in a

second Shonda is what's differently to

trust Dee and a guardian and can they be

the same I know that's one of the

questions that pop up a lot and I know I

had it and I should Lee - so once you go

ahead and dress that yeah good question

so excuse me

allergies down here in North Carolina

they grabbed me hard this week I tell

you what it's crazy

the a trustee he is the person who's

going to manage the trust so really when

I think of a trustee I really I define

them as having four main jobs one they

should have some idea of what your

child's needs are right they should have

some connection to your child they don't

have to be the Guardian they don't have

to be a family member they just need to

be connected to the Guardian and be in

communication with them right more than

just you know once every blue moon or

once a year they should they should

understand kind of what your child needs

and be involved in that they have to

make sure they manage the money that's

inside the trust appropriately they have

a fiduciary responsibility to the

grantor but also the beneficiary of the

trust your child they have a fiduciary

beneficiary to make sure they do the

right things they have to do a tax

return if the trust warrants it every

single year and pride the most important

one other than the first one about

making sure they understand what your

child needs is they need to understand

the distribution rules of a special

needs trust right we talked about that

earlier there are rules around how you

use the money out of the special needs

trust is it unbelievably complicated no

so I don't want you to be scared away by

all the stuff we talked about and it

sounds like oh my gosh my head hurts you

got to be kidding me right this is just

one tool that I have to figure out oh my

god I think I'm gonna go take a nap but

before that I'll have a glass of wine

right I mean something you know whatever


I don't please don't don't take it like


you know if you know or you work with

people that know it's going to be easier

right and so that's what we want to make

sure that you have information so there

are distribution rules that you have to

follow right you have to follow that

there is going to be an accounting of it

to the Social Security office right when

they do an audit and they can do that

every year they might do it every two

years every three years there's no

there's not necessarily a set time frame

right now that they do that many times

they will

get it when they review how you spent

the SSI money right especially if you're

the representative payee and your

child's receiving SSI they do review

that to make sure that that money is

being used for your child's benefit well

at the same time if there's a special

needs trust there they usually review

how you're using that as well so there

are rules that have to be followed when

you're distributing the money trustee

needs to know those rules or they need

to have an advisor that they are in

communication with and that they're

working with so they make sure they use

it in the right way that's what a

trustee does the guardian is the person

that is caring for your child day to day

right maybe they're living with them

maybe the guardian is the one that's

overseeing them because your child is

living in a maybe a group home setting

or maybe a independent living apartment

but with some level of oversight from

another company but this guardian is

involved with that company make sure

your child is okay they're getting the

services they need you know they're the

ones going to Social Security office to

make sure things are working well you

know they're going to the doctor's

appointments you know they're the

day-to-day individual of care excuse me

so that they're not in charge of the

money they're in charge of the person is

an easier Pryor simpler way to say that

for it if that would have been like a

30-second response Ryan no I'm kidding

exactly instead of three minutes yeah

sometimes I have two words back in my

mouth everybody yeah and so so so now a

lot of we had a number of questions

Keith - and I'll keep going on this

because I think I'm answering another

question if I'm not Keith stop me but

they also had a question of you know

should the guardian the trustee be the

same person should they be a different

person you know that's always going to

be an individual family decision right

depending on how you want your family to

look at so that is a planning discussion

but things that you should think about

in that planning discussion is many

families when I first started we did

have a trustee who was you know brother

Bill and then we had the Guardian who


mr. Jane well that's good at separation

of powers right okay that's good well

what I've learned is you know and and I

call it in the moment or on the ground

you know how does this actually function

in the real world because that's what we

need to think about right we can't we

can't always be in the theoretical of

well I'd like it to be separation of

powers and then talk to each other and

make sure they're making the right

decisions for John well you know what

let's say let's give an example of let's

say you're at the grocery store but you

don't have your wallet because somebody

else controls it so now in order to get

out from paying for the gallon of milk

you need to call the person who controls

your wallet to get the credit card

number to pop in the machine so you can

leave with your gallon of milk that's

kind of what we're doing when we have

the trustee as one person in the

guardian of as another if they need any

if the Guardian needs something for your

child they always have to go over here

and get authorization right so so it's

okay it's legal and sometimes it's

easier for the Guardian to be the

trustee now the next question a lot of

times with that is well you know though

Jane's really good with them but man she

is not good with money I don't think

that's a good idea

right and Bill I mean you know he

watches the pennies I know he what Jane

kind of likes to spend money bill

watches the penny so you know I'm not

sure I like that you know Guardian

trustee being the same person awesome

good thought so here's what you do right

you when you're talking to the attorney

that better know what they're doing by

the way make sure they set these up a

lot and say you know what I'd like Jane

to have some ability to use the money

for day-to-day items right so what you

do is in the trust you just put a budget

in there and you say you know what Jane

yes she's going to be a trustee but so

is Bill and Jane can use you know she

can use the money in there up to a

certain adop to a

certain dollar amount of decisions right

so if that's $500 a month or $1,000 a

month or whatever it is for you or

$2,000 whatever it is for you you kind

of put a limit on the everyday daily

items that she might need but on big

purchases anything above a certain

dollar amount then bill has to be

involved and authorize it right and so

then all of a sudden you do have that

separation of powers but you also give

the guardian some ability to live how

life actually happens right and so you

want to think through so it's not just

having a trust everybody it's making

sure that the design of the trust works

for your child with special needs but

also the other people who are going to

be involved right the guardian the

trustee it needs to work for everybody

and everybody needs to understand their

job you know I draw the parallel me need

like me I'm on my son's Guardian and I'm

his trusty right now I can imagine if I

was gone and someone had to go ask for

money if I go to the store and give him

something I can just get him something

right now

I don't need to go ask somebody for

permission to get him something and that

could be another issue too the thing

that depending on the dynamics of the

two people they may not get along like

that they might just be you know who

knows what they could be doing so to

really think through that I think is a

very important thing without a doubt I

can just see it be a very problematic if

I had to go ask someone for money every

single time I needed it for my son and

our vice versa so and I see Shawn

I hope I'm not your name correctly Shawn

has a question and that Sun is bright in

my eyes so that's why I'm squinting

everybody so sound is asking when making

a request from the trust to buy like

clothes even what is the proper process

you want to address that real quick

right yeah I mean you know the the

proper process is really just to again

you know have someone in on your team

that understands the rules of the

special needs trust right so you know

and I've used this example before right


we help trustees manage special needs

trust that's part of what we do as part

of serving our families and so one that

one that we use is it's a small trust

right and so but but mom had a question

on it you know her son heard her son is

younger and he's kind of a runner so you

open up the door and he runs out well

their backyard goes off of a cliff so

they called and said hey Ryan can we

build a fence around the house and can

we use the special needs trust money to

pay for it all well the answer is no you

can't because that fence has a benefit

for more than just her son remember one

of the definitions of a special needs

trust is the money is used for the sole

benefit of the beneficiary and who's the

beneficiary there's one of them it's

your child with special needs nobody

else right so when you put a fence on a

house that more than your child lives in

well what does that do well that gives a

benefit to the parents who own the house

because the value of the house goes up

all right that gives benefits to the

other children in the house because it

provides them safety as well so in their

situation they could they could use part

of they could they could basically pay

for 20% of the fence with special needs

trust money because that that wouldn't

draw any big red flags mm-hmm and so you

know when you're thinking about what you

can draw out one make sure you know the

rules so you can just go through and say

okay what do I need and some things

that's really easy right close yeah you

can just go do write clothes you can do

food yeah not so much depends on where

you are right if you're on vacation and

away from home yeah you could you could

buy food with money from especially nice

trusts if you're at home you're not

supposed to be buying groceries with

monies from especially nice trust

because you're supposed to be used using

government benefits for that purpose and

so again some things are real easy to

see on the rule

other things are a little bit of an

interpretation and on those you know

what I always recommend is you have a

guide that does that on a daily or

weekly basis and understands those rules

and stay out and stays on top of them

for you so Ryan I'm surprised that we

did not get this question but I know it

brings the question in mine and we've

had in the past is yeah what kinds of

things can people our qualified

expenditures in our distributions from

especially stress so you just mentioned

food if they're on vacation but not food

if they're here in town how's it going I

know someone asked about housing

expenses and how that plays out is I

know that I don't you go through the

complete list but can you give us a

quick summary of types of things that

could be included and should not be

included within distributions for a

special needs trust yeah I mean what one

of the and and I have to say I stole

this term from a couple attorneys in

Chicago so it's not mine I always like

to give credit where it's due and if and

if you know if it's not mine I don't

take credit for it but they had an

interesting term that they use they said

eat and sheets and so what special needs

trusts are not supposed to really pay

for our housing and food but can pay for

everything else so what does that mean

well if they have a cell phone they can

pay for cable because there's and

housing means like rent and you know

like the heating bill right but not

cable not furniture not a cell phone so

you can pay for all those with special

needs trust you know if we go to an

amusement park you know you can pay for

that with special needs trust if we're

buying CDs or a DVD or a DVD player or a

TV or a computer or an iPod or or a

tablet or anything that you can pay for

that with with a special needs trust

shoes clothes are now no problem to pay

with a with a special needs trust now

there are there are some things and this

gets into some more details of of kind

of planning right because IP were like

they might be hanging up right now any

more because I wanted to pay for housing

now again you know like I said

there are rules out there and then there

are ways to work within the rules and

structure things so that you may be able

to pay for housing in a little bit

different way depending on your child's

situation right this is very dependent

there's one question on here about you

know KenKen especially stress own a home

and land yes it can and that's one of

the ways that if you have your child

living in a home home that you own and

you want them to stay there and you've

already set that up with caregiving well

then all of a sudden you know you don't

want your child to own that home because

that that's going to be problematic for

the trust to pay for and then government

benefit qualification so you want the

trust to own the home and then all of a

sudden because the trust owns it and

your child doesn't now the trust can pay

for property taxes maintenance

homeowners insurance you know all those

other pieces your child can pay rent to

his own trust because he's paying it to

the person who owns the house so there's

all sorts of different ways and then

there's even other ways that you know we

have you have families that live in

areas of the country where you know they

don't want them to live in the

apartments or the area of town that they

can afford with government benefits

because they're worried that it's

dangerous right so now you can use money

from the trust to pay for housing this

is a little-known fact what that's going

to do is reduce your SSI payment that

you child receives so if that's going to

be the situation we need to plan for

that and understand what does that mean

to the amount that needs to be in the

special needs trust and what does that

mean to their benefits right because

depending on the amount that you're

gonna pay for housing it's going to

decrease the SSI payment to a minimum

level which is what's called the PMV so

there's a minimum level of SSI that they

would still receive even if the trust is

paying for you know some some housing

costs so there's so there's some things

in there that you can do and and you

know and

just make sure that you do it within the

system but for for a good rule of thumb

eats and sheets you're not supposed to

pay with for a special needs trust I

have to be careful with that one no Ryan


all right so Jerry I asked you to email

me and I will get that information fro

you so don't I don't have it readily

available now Meghan is asking I have

always found government benefits to be

restrictive to the point that I would

like for my child if possible to one day

be free of it if my child is not

receiving government benefits what a

special needs trust still be preferable

well I guess my you know if you were

sitting in front of me I would ask you a

follow-up question of that and my

follow-up question be preferable to what

and so you know one of my questions when

when I hear that is I want to learn more

about the child what are their abilities

what are they able to do what are they

able to understand where do we think

they may be going in their life

developmentally what kind of supports do

we think they're going to need in the

future and what does that mean in terms

of a resource level that the family is

going to have to provide for them if

we're using government benefits and then

if we're not so that we can have a

clearer idea of exactly what that means

to decide not to include government

benefits in your planning that's very

important you know you're right there

are hoops to jump through with

government benefits right if we don't

use government benefits there's a lot

less hoops to jump through but a lot

more resources we have to come up with

to provide our child with the lifetime

with their lifetime support needs and so

it's it's really dependent on you know

is that going to be possible there are

some families that can they're gonna be

fairly fairly wealthy because when

you're thinking about taking care of

somebody for their entire lifetime with

no support from the government you know

you're looking at it at a you know

usually millions of dollars to be able

to do that for somebody's lifetime of

needs because you have to pay caregivers

and then you have to pay for housing and

pay for utilities and they don't have

any income and so you know it's it's uh

you know again depending on the family

yes you can do that would you need a

special needs trust not necessarily what

I would say is you would need a trust

because you need protection around your

child you wouldn't want them to have

that amount of money just for themselves

especially if they don't understand

certain ways of the world and many of

the families we work with you know their

child's a little bit naive you know like

like a lot of individuals are just about

money and and the intentions of people

and so really you'd want it to be in a

trust if you don't want it to be a

special needs trust that's fine for the

government benefits purposes but it

should still be in a trust that's not in

your child's name so it's protected from

people who want to get at it and want to

use your child to take that money away

from them and unfortunately I hate to

think like that but but that's kind of

what I do is those are the kind of

things I think about so that they never

happen okay

Meghan just responded back in a Meghan

effect what answers your question

hopefully that that did now I'm gonna go

to some questions that we got previously

that people submitted and be sure if you

have any questions please sure to enter

em here in the chatroom and I'll do my

best to get to them we try to keep the

webinars to about 40 45 minutes and we

might go a little longer than that today

but we want to make sure we give you

guys the information that you guys need

as best as we can so are there any

minimums or maximum amounts Ryan for

special needs trusts is there a minute

amount you need to fund it is there a

max amount that you need to fund it yeah

there's there's really not that there's

no minimum there's no maximum you know

now now I say that right and and then

I'm gonna give you a

disclaimer so so in general no there's

not because again a trust can own any

account that that we can own as people

except for you can't open a retirement

account as a trust right you can't go

open an IRA in the name of a trust

because there's no person right there's

no birthday there's no there's no person

associated with or seek it but you can

own a savings account in a checking

account so you could open up a trust


you can go get a trust document done by

an attorney get a tax ID number from the

IRS go to the bank and open up a

checking account and if they give you a

free checking account with a hundred


there's your trust account right boom I

wanna you know if there's more dollars

in there and we want it to be invested

well then some of those minimums may

come in from the investment company that

you decide to put your money with and

then if you want a corporate trustee or

a trust company to manage it for you at

some point well again they many times

will have minimums of an account value

that you have to have for them to manage

it now again that's not to have a

special needs trust that's to have

somebody else manage it for you right so

that those are the distinction I want to

make so so the the bass answered your

question is no there's no minimum

there's no maximum okay great Shonda

asks how do I get to pay for items like

DVDs clothes and the like zoo they say

they have to they have to check those

are all kinds of things to be covered up

and paid for up a special needs trust am

i right absolutely yep you can take that

out and what you just want to do is is

if you're the trustee as a parent or a

sibling is you know it's really it's you

want to have an account that will that

will basically you know just monitor

where you spent that money from right

and give you a report at the end of the

month or you can keep a spreadsheet that

says hey we use this amount here this

amount here again a lot of times you

know there are certain companies that

will you know provide like a debit card

or a special credit card specifically

for special needs trusts and then by use

that card you would get a report every

month of exactly where you spent the

money so that then that would be an

automatic report that you would print

out and bring to the Social Security

office so that when they asked for hey

how did you use this money it's right

here I have it this is what we did I

bought a ticket to the zoo

you know I I bought a DVD I went to

Walmart and got clothes you know this

this this this that you know so again it

doesn't have to be arduous if you get it

set up the right way

excellent now I'm gonna go ahead and ask

Melanie's question because we've been

asked that at least four or five times

in well over 100 questions that you guys

submitted we appreciate that that that

you guys are so interested in the topic

Melanie asked I have Co guardianship of

my 22 year old son with severe autism my

ex lives in Florida my son lives with me

in Pennsylvania we do have a special

needs trust set up because his father

lives in Florida is the trust developed

in Pennsylvania still working in another

state so do trust go from state to state

or is it state specific I guess is the

question Melanie right and so so first

I'll answer her specific question is you

know as long as she's in Pennsylvania

they did it in Pennsylvania and you know

she passes away and then you know all of

a sudden maybe some assets go into the

trust from her right no problem right

the trust is activated you can move it

anywhere in the country you know you

you're fine doing that because it's

already kind of being managed right so

you don't have to redo that now if

there's if there's no money in it and

then all of a sudden her son moves to

Florida with dad and now dad and son are

both living in Florida you know or

another another situation like you

mentioned Keith right we lived in

California and we moved to Maryland and

we did our specialties trust in will in

California now we live in Maryland the

basic idea is you do want to have a

special needs attorney just review it in

the state you now live there are

certain states that have reciprocity

with one another meaning that whatever

is good there is going to be good here

right but there may be other states

where you move from one state to another

that you just want to make sure that

it's still gonna function well

especially if it's not funded yet right

every all the parents are alive child's

alive you know you just move because of

work or whatever that was whatever state

you're in you just want to make sure

that that it would it would still

function the way you wanted to within

that new state you know that brings up

good question Melanie I'm not trying to

project anything but it brought up a

question for me so assume that Melanie

dies in Pennsylvania and now son moves

in with dad in Florida and the trust was

created in Pennsylvania you just

answered now that she needs to that they

need to Reeve to revisit that trust in

the new state but the question I have

now is these trusts are usually based

upon when you're no longer here so isn't

it's the communication that we need to

make sure the next Guardian is aware of

so that you know we're aware of it

because we're on this webinar and we're

learning about it right now but I can

just imagine now 20 years down the line

I'm not here I didn't have this

communication with my next guardian or

trustee they don't know about the laws

and then they're in Florida because they

moved there now so this has got to be

part of your communications plan I would

imagine that you have to be able to

communicate to the next caregivers all

the things that are important absolutely

before yeah we definitely want to do

that and again that the the situation of

you know if if and just going back to

Melanie situation years because I want

to be really clear here I I don't want

people to get the wrong idea is that you

know let's say Melanie dies and there's

a tax ID number already with the trust

right the trust is its own entity we

just didn't make an account yet we

didn't put any money in it there's no

account well if there's a tax ID number

associated with it already and then and

then it was Melanie right Melanie passes

away and and Melanie you were you were

gonna put some money in it let's say you

were gonna put a $25,000 in it when you

or whatever assets you have we're going

in it well if that goes in it at your

death then all of a sudden all your

husband has to do is open an account

with that tax ID number and that's fine

that trust is going to be fine in

whatever state your your child moves to

so if he moves in with his father in

Florida no big deal because you died

money went in it in Pennsylvania and

it's open and then it doesn't matter

where your child lives it's only if the

trust is not really activated yet mm-hmm

and then you move States right so the

whole family moves States that's where

you just want to make sure the documents

are going to align with with the new

state you're in okay so if if a trust is

already active and there's money in it

your child can move wherever they want

to move but all right and and and that

account just goes with you just like

gars checking and savings accounts right

if we move since there's money in them


if we move from California Arizona we

don't have to open up a new checking

account as long as our bank is you know

online we can keep banking where we are

okay excellent Thank You Ryan for that

here's a question comes in let's see I'm

trying to read it do we need a will and

a special needs trust and can you have

more than one trustee we already answer

that yes you can have more than one

trustee you can have co-trustees so so

do you need a will and a special needs

trust as a question it came from someone

if well you know you don't have to you

know there's no well it's you know I

always say you know this is not only

doing your taxes right you don't have to

do any of this stuff right you have to

do your taxes or else the IRS is going

to come after you right and you could go

to jail you don't have to do any of this

stuff you don't have to but what you're

doing is if you don't if you don't have

it well and you don't have a special

needs trust what you're doing is you're

leaving the decisions for your child's

life to the state in which you live in

so when you don't have your

will that you design yourself with a

special needs trust then what you're

doing is you're leaving the decisions to

basically the legislature of the state

you live in that has made a will for you

there is a will for you even if you

don't make one it's just not made by you

it's made by the state government you

live in and that's who you're leaving

your wishes and your child's life to so

the short answer is you should

definitely have a will yeah right short

answer is I would say you definitely

want to get one right yeah because I

heard you say this before you the will

sort of says were your things go and

we're your people go right you said

something like that before yeah yeah

okay there are so many rules about what

a special needs trust money can't be

used for how does the manager with trust

navigate around these rules great

question and they should either they

should be a professional that knows them

or the trustee should have access to

them you know I and again you know I

always like to liken it to to the

medical industry because we seem to

understand that better all right you

know brain surgery is really confusing

for me I have no idea how to do it but

for the brain surgeon that does it every

day it's not because they've been

educated they've been trained and

they've been certified to do it it's the

same thing for this guys I don't and I

don't mean the likened special needs

planning and trust the brain surgery but

it is a specialized area that has a

major impact to that to the welfare and

health of somebody you love right

well Ryan I think that that speaks to it

all right there

Janet is asked what happens if the

trustee dies after I die I trustee or

guardian I'm sure I shouldn't so how do

you want to address that

okay she could be meaning the Guardian

yeah or the trustee all of you that is a

that's a fantastic question so one

the things that you want to do in it and

that question comes up a lot of times

depending on the age that we are so

sometimes when let's say we're in our

40s and 50s and our kids are in their

teenage years you know when we put these

documents together the guardian and

trustee are probably going to be in our

generation right and so it's likely

they'll die before we will and so what

that means is you're going to have to do

this again you're gonna have to redo the

will and redo the special needs trust as

you age and as the generations develop

underneath you that's why this type of

planning that we tell our families it's

it's the it's the most

multi-generational planning that you

have to do it is it's not just you and

your generation depending on your age

it's the generation above you it's your

generation and the generation below you

and your advisors should understand that

and know how to communicate with all

three because that's what this planning

is so so if if you're so let's say we're

in our 40s or 50s and the other trustee

dies before you then again you're gonna

have to redo your documents or you can

if you have enough people and this is

usually the the problem a lot of times

with with with whenever we just don't

have that many people to put in there

right we just don't we don't have a list

of 10 people we can just keep putting in

there as next trustee next trustee but

what you can do if you do have multiple

people who could be the trustee is you

know you can start with one trustee if

they passed away you can already write

it in the document who your next one's

going to be and so where does this come

into place so many times what what we

talk to families about is let's say that

you have let's say you're in your 50s

and you have a child with special needs

that is 17 and you have another child

who's 23 right and they're just

finishing college right and you're like

well if I die tomorrow he I don't really

think they should be the trustee or

Guardian I'd still like my sister

to be the trustee regarding great well

what you can do is you can write in

there say okay that's what I want now

but as my child as my other child grows

you know at thirty years old when they

reach thirty I want my sister Jane to

make a decision of we of giving the

reins over to my other sibling you know

depending on their stability level right

and so you can put that in there and

build that into that document so that it

kind of lives a little bit longer then

maybe it normally would right let it

live a little bit longer give it some

growth and development based upon the

age of your family especially if you're

in that midpoint of you know our kids

are fifteen eighteen and twenty or you

know whatever that is where none of them

are quite able even though they're

legally old enough to be a guardian and

trustee over the age of eighteen they

really don't have the capacity or

ability yet to do that job and you're

not quite comfortable but you know what

in ten years maybe they are you know so

you can write that in there you can kind

of build that in for yourself and for

your family you know this question came

up several times in several different

ways but it comes to mind again now is

this is not a document that you can

create wants to forget about it it needs

to be a living breathing document

because somebody wrote in here that they

did their will about their their trust

back in two thousand four that's almost

twelve years ago right so they listed as

trustees and/or guardians in their trust

may still be alive may not be alive the

sequence might be different one of them

who was a great trustee or guardian at

one time it's coming through some

financial situations and no longer so

such a good selection for that it's

something that you should every year

take a look at and see if it still makes

sense because remember when it all

happens and it all comes in places when

you're no longer here

so you just can't create it once put it

into a unto a drawer and forget about it

and hand it to someone twenty years

hence or it gets handed to someone

twenty years hence because a lot of

those original assumptions may be

different because you select somebody as


already and now who's gonna know about

it but they get married and their spouse

is not so gonna know about it

right you wrote it 20 years ago but now

they're married and their circumstances

change or they don't longer live in the

place that was close they now moved

overseas so it is definitely something

you should keep an eye out and look at

regularly just to see just to touch it

say okay are these assumptions still

valid do I need to make some changes so

that's hitting me really strong today is

like wow it's not a create it and forget

about it kind of document for sure

alright sorry I'll get off the soapbox

there right but it hit me and I was like

wow that's pretty true let's see what

else do we have how long is a special

needs trust valid I don't even know the

answer to that one is it forever yeah

it's it's valid until it's replaced by

another one so just like your will will

continue to be valid until you replace

it with another one so for example if

you did a unit especially stress in 2004

and you die in 2050 they're gonna look

back at that 2000 for special needs

trust and and and look to see what it

says okay excellent question came in how

can I change who is the trustee now

we've talked earlier about what a

trustee and a guardian is so let's say

you decide that you want to change your

trustees it a easy process is a

difficult process yeah well what you

need to do is you need to either go back

to the attorney that you did it with or

go to another one and you can do a

trustee change within the document and

depending on the document how old it is

you may have to rewrite it in terms of

rewriting the document to put that

person in there or you can just make a

change to it so it just depends on on

how old that document might be I had a

trust recently done as you know for my

son's first party settlement because

there was a lawsuit that he was involved

in and another story and another webinar

yeah but so it had in there the

provisions for how to change the trustee

and it was you know legal restrictions

the attorney if they know what they're

doing they're gonna consider all those

things if they don't know what they're

doing they're gonna just put one trustee

in there I think that's the end of it

that's why it's so important that you

work with someone who really knows what

they're doing and and and we're

hopefully helping you guys walk through

some of those process here so here's

another question that came up quite

often this is my only child or even if

it's not my only child should I leave

all my retirement to them all my money

to this child yeah so another good

question and and we're just going to

back up to make sure and I know this is

gonna sound like we're you know being

real picky with the words and and and

word choices and things like that but

just want to be clear again some of the

questions we had as ki said you know I'm

gonna leave it to my child and so you

know what we want to make sure is that

we don't leave it directly to your child

right we don't want to leave it directly

to your child or else that's an asset

for them and they if it's more than

$2,000 they could be disqualified from

those government benefits support

systems like Medicaid and Supplemental

Security income one of the things is can

we leave it directly to my child special

needs trust and if we add that language

to that question the answer is

absolutely yes

right sure if you're if you have one

child you can certainly leave all your

assets into your child's special needs

trust right as long as you want to

protect those government benefits and

those services that's where you would

want to leave it you know certainly if

you have one child certainly you could

put everything in there I would again we

haven't talked anything about this which

is almost its own subject but you know

one thing that you want to be cognizant

of is taxation inside of special needs

trust and what accounts you're gonna

leave there you just just wanna you just

want to understand that's a that's a big

piece of kind of special needs planning

it obviously involves special needs

trust but it really dives into

your family's financial decisions and

where you're saving money for yourself

and where you're putting it and then

which assets you're gonna leave for your

child even if you only have one child

there may be things you want to adjust

in your own planning to save in a better

bucket so you don't lose 40 to 50

percent of the asset when it goes into

the special needs trust again so the

simple answer your question is as long

as you add to my Chuck can I leave all

my money to my child special needs trust

the answer is yes you can yeah I forgot

about that Ryan you know that for those

who are never I'll never forget about

that one for those who do not know the

tax rate for special needs trusts is a

very compressor 8 I think I'd like

anything over $15,000 or even lower than

that as a tenth out well over $12,000 it

starts getting taxed as high as 50% if

you inquit things right when you add

state taxes in there so again it just

depends on the state you're in now no

that's not that's not every account that

you would put in there I want everybody

know that don't think that all the money

you put in there is going to get taxed

at that rate not true but for certain

types of accounts the way they work and

the way they've been taxed are not taxed

yet that's where they can get hit pretty

good going into a special needs trust so

again I don't want you to think oh my

gosh I'm not gonna use this because the

tax is not true right there are certain

things that won't get taxed at all when

they go in there so again just you know

I don't want to scare you but I want you

to be aware right because I don't want

you to make mistakes where we lose

resources and that's what I think a lot

about this process this special needs

planning process is efficiency in

resources for your child's lifetime

support needs we don't want to lose

resources whether they're our own right

that we want to leave for them we don't

want to lose them by making mistakes

because we just don't have the correct

information and we don't want to lose

the government benefits that we're

receiving because we do something in the

wrong way right we want to maximize the

resources that are available whether

they're your own or whether they're the

government's for the benefit welfare and

health of your child's lifetime we're

getting close to the hour Ryan as you

know we try to to wrap them up there but

questions are coming in and and some of

them Jerry and Carol we're working on

some things to help you guys with

answers to those questions to help you

sort of identify how you select

professionals and what kinds of

questions to ask them to make sure

they're actually knowledgeable so keep

an eye out for your email for some

things coming from Ryan and I is in a

little bit

Jerry email me about that I have a great

article about learning about the

taxation rates for special needs trust

and it's a great article written by an

attorney out of California someplace

it's a few years old but the content is

still the same it's a very heavily taxed

saying it's really important what kinds

of assets you put in there that's why I

again and so important for you to talk

with people who know what they're

talking about because if you're not you

put the wrong kind of asset in there and

all sudden you have a million dollars

that now is only worth five hundred

thousand because there was a mistake

made and I arrest the saying thank you

very much for all that money that's not

what we want right right because when

you and I first start talking right I

had some specific ideas of things I

wanted to put in there and you're like

wow that would be the the dumbest thing

in the world to do right and so it was

the encryption let's look in your face

like what an idiot now that I've known

you for two years that's what I would

say at that time you just looked

incredulous and said clearly I need so

anyhow guys we don't want to hold you

all day long we are going to talk Ryan

and I about some other options in terms

of when we have these webinars I know

some people have expressed not being

able to get here certain times and so

we're doing the best we can this is just

a labor of love for me

and I know it's helped another phase

which because all the emails I get from

you guys I just thank you it's it's a

blessing for me to be able to learn and

to see you guys learn at the same time

because either the same questions I have

I'm a father of a son with autism and

I'm like what do i do what do I go what

do I do is so I've been picking Ryan's

brain and and learning a lot so that's

what these webinars and these broadcasts

are all about so we're gonna go ahead

and wrap up Ryan you have any words of

wisdom or something I should have asked

you that I did not ask you today that

you want to address I you know what I

don't think so right now Keith I know

the questions are gonna keep coming in

we didn't even get to them all I know

you guys have a lot of questions you

know stay tuned for for continued

hangouts you know you're always welcome

to go to you know our website especially

end comm you know and or go to our

special voice org as well you know where

you can grab some more information and

resources and all right everybody thank

you very much enjoy and I'm really not

set up for that it's just Keith trying

to figure this all out myself so email

me and I can promise you I can get you

with anything you want but I don't know

a way to send it to everybody in one

lump sum so bear with me I'm just dad

trying to figure it out too and I don't

know all the technology so be any of you

guys want to volunteer to help a brother


yeah good please do I am no help on

technology you know so Shonda please

email me and I will get you everything

that I have that everyone's been asking

for so thank you everybody for joining

us and we will see you soon