Special Needs Trusts in Connecticut

A special needs trust is set up for a person with special needs to supplement any benefits the person with special needs may receive from government programs. A properly drafted special needs trust will allow the beneficiary to receive government benefits while still receiving funds from the trust. There are three main types of special needs trusts, but first it is important to understand how a typical trust works.

A trust is really a relationship between three parties — a donor, who supplies the funds for the trust; a trustee, who agrees to hold and administer the funds according to the donor’s wishes; and a beneficiary or beneficiaries who receive the benefit of the funds. Often, but not always, the donor’s wishes are spelled out in a document that gives the trustee instructions about how she should use the trust assets. Trusts have been used for estate planning for a long time, and are highly useful tools for ensuring that a donor’s property is administered as he sees fit. One of the reasons trusts are so popular is that they usually survive the death of the donor, providing a low-cost way to manage the donor’s assets for others when the donor is gone.

A special needs trust is a trust tailored to a person with special needs that is designed to manage assets for that person’s benefit while not compromising access to important government benefits. There are three main types of special needs trusts: the first-party trust, the third-party trust, and the pooled trust. All three name the person with special needs as the beneficiary. A “first-party” special needs trust holds assets that belong to the person with special needs, such as an inheritance or an accident settlement. A “third-party” special needs trust holds funds belonging to other people who want to help the person with special needs. A pooled trust holds funds from many different beneficiaries with special needs.

The reason there are several different types of trusts has to do with regulations regarding Supplemental Security Income (SSI). SSI is a government program that assists people with low incomes who have special needs. In order to qualify for SSI, an applicant or beneficiary can have only $2,000 in his own name. If the person has more than $2,000 in his own name, (typically because of excess savings, an inheritance or an accident settlement), the government allows him to qualify for SSI so long as he places his assets into a first-party special needs trust. The trust must be created by the beneficiary’s parent or grandparent, or by a court, but it cannot be created by the beneficiary, even though his assets are going to fund the trust. While the beneficiary is living, the funds in the trust are used for his benefit, and when he dies, any assets remaining in the trust are used to reimburse the government for the cost of his medical care. These trusts are especially useful for beneficiaries who are receiving SSI and come into large amounts of money, because the trust allows the beneficiary to retain his benefits while still being able to use his own funds when necessary.

The third-party special needs trust is most often used by parents and other family members to assist a person with special needs. These trusts can hold any kind of asset imaginable belonging to the family member or other individual, including a house, stocks and bonds, and other types of investments. The third-party trust functions like a first-party special needs trust in that the assets held in the trust do not affect an SSI beneficiary’s access to benefits and the funds can be used to pay for the beneficiary’s supplemental needs beyond those covered by government benefits. But a third-party special needs trust does not contain the “payback” provision found in first-party trusts. This means that when the beneficiary with special needs dies, any funds remaining in her trust can pass to other family members, or to charity, without having to be used to reimburse the government.

A pooled trust is an alternative to the first-party special needs trust. Essentially, a charity sets up these trusts that allow beneficiaries to pool their resources for investment purposes, while still maintaining separate accounts for each beneficiary’s needs. When the beneficiary dies, the funds remaining in her account reimburse the government for her care, but a portion also goes towards the non-profit organization responsible for managing the trust.

Anyone can establish a special needs trust and, if the trust is properly drafted to account for tax planning, in certain situations gifts into the trust could very well reduce the size of the donor’s taxable estate. As if these are not enough reasons to create a trust, elderly people who are attempting to qualify for long-term care coverage through Medicaid can transfer their assets into a properly drafted third-party special needs trust for the sole benefit of a person with disabilities without incurring a transfer-of-assets penalty, allowing the elder to qualify for Medicaid and making sure that the person with disabilities is taken care of in the future.

Of course, every person with special needs is different, which means that every special needs trust is going to be different as well. The only way to determine which special needs trust is right for your family is to meet with a qualified special needs planner to discuss your needs. To discuss whether a special needs trust is right for you please contact Susan Maya, Esq. at SMaya@Mayalaw.com or (203) 221-3100.

Special Education Law Update: Supreme Court Decision on Private School Reimbursement

A United States Supreme Court decision has removed some of the hurdles for parents of students with disabilities to seek reimbursement from local school districts for their children’s private school tuition.

The 6-3 decision ruled that parents are no longer required to first send their special needs child to a public program before placing him or her in a private institution which could better address those disabilities.  The ability to effectively skip this step would save many children precious time to learn and achieve necessary educational goals, while preserving the right to a free, appropriate public education for all children with special needs.

The full text of the decision can be found at: http://www.supremecourtus.gov/opinions/08pdf/08-305.pdf

For more information, please email: hdmurphy@mayalaw.com

New Connecticut Special Education Law

Connecticut Public Act No. 08-160, An Act Concerning School Learning Environment, is of interest to parents of school age children and, in particlular, parents of children with special needs.

Two of the major changes that are enacted are (1) all suspensions starting July 1, 2009 are in school suspensions unless it is determined that the student is dangerous or disruptive to the educational process; and (2) all schools must “develop and implement a policy to address the existence of bullying in its schools.”  Also of note is a new provision that provides for in-service training for school personnel and pupils on a variety of issues they face daily.  A few examples are: (a) drug and alcohol awareness; (b) “health and mental health risk reduction;” (c) working with special needs children in regular classrooms; (d) cpr and emergency life saving procedures…..

  

Special Education Law: Evaluation and Identification

Children identified as having disabilities have different rights from other students. Accordingly, the identification process is a very important step. It begins with a referral sent to the student’s school district – specifically, a written request for an evaluation of whether the child is eligible for, and needs, special education services. This request can be made by the child’s parent, school personnel, or another appropriate person (such as a physician or a social worker).

Once the school district receives a referral, it must convene a planning and placement team (“PPT”) to review the referral, determine whether further evaluation is necessary and, ultimately, decide whether the child requires special education services. If the PPT requests further evaluation of your child, such evaluation will be conducted at the school district’s expense. Once the PPT has made its determination, you have the right to request an independent educational evaluation (“IEE”) of your child if you disagree with the PPT’s decision. If, after the IEE, you still disagree with the PPT, you may request a hearing in accordance with State Department of Education regulations. Our attorneys will work with your family to determine the best course of action and to protect your child’s educational rights, while ensuring compliance with applicable federal, state and local regulations.

Connecticut & Federal Statutes – Special Education

State Statutes:
Connecticut General Statutes § 10-76 et seq.
Connecticut General Statutes §10-233d(i)
Connecticut General Statutes § 4-183

Federal Statutes:
IDEA (Individuals with Disabilities Education Act), 20 U.S.C. § 1401 et seq.
Section 504 of the Rehabilitation Act of 1973, 34 C.F.R. Part 104.

Special Education Law – Relevant Terms

Applied Behavior Analysis (“ABA”): An intensive, structured teaching program in which behaviors to be taught are broken down into simple elements. Each element is taught using repeated trials where the child is presented with a stimulus; correct responses and behaviors are rewarded with positive reinforcement, while when incorrect responses occur, they are ignored and appropriate responses are prompted and rewarded. [Read more]

What if the school gets it wrong?

As the parent of a special education student, you have the right to, and should, participate fully in your child’s PPT meetings. [Read more]

Re-evaluations, revisions to IEP and transition to post-secondary, adult life

Each student identified as special education eligible must be re-evaluated at least once every three years, but not more than once per year (unless the student’s parents and the school district agree that more frequent re-evaluations are needed). [Read more]

Placement in appropriate programs

Special education students are entitled to a free appropriate public education (otherwise known as “FAPE”), that must be tailored to the individual student. However, schools are not required to provide optimum programming – just “appropriate” programming. One federal judge has likened the difference between optimum and appropriate programming to that between a “Cadillac” and a “serviceable Chevrolet.” See Doe v. Bd. of Ed. of Tullahoma City Schools, 9 F.3d 455, 459-60 (6th Cir. 1993). However, if a particular service is required for the student’s special education needs, as evaluated, then the service must be provided without regard to how much it costs.

Sometimes, public schools simply do not offer the services that your child’s special education needs require. At this point, it may be possible to place your child in an appropriate private school and seek reimbursement from your school district for the associated costs. In order to do this, you must request a due process hearing and prove to an impartial hearing officer that not only does the private school meet your child’s educational needs, but that the school district failed to provide your child with a FAPE in a timely manner. Furthermore, you must comply with relevant statutory and regulatory requirements or your reimbursement award may be denied or reduced. Significantly, one misstep in this process can mean losing your right to reimbursement – there are time limitations and notice requirements to comply with, and it is important to know all the details before a parent unilaterally places a child privately. Our experienced attorneys will make themselves available to guide and assist you in making a quick and efficient determination of the most effective plan of action for your family, while protecting your rights under applicable regulations.

Development of IEP

The IEP is an individualized educational program developed by you and your child’s planning and placement team. It is based upon the evaluations of your child discussed above, and tailored to his or her individual special education needs. Each student’s IEP is reviewed and updated at least once each year, and the importance of its contents cannot be overemphasized. The IEP sets forth much more than merely your child’s current performance. It also details what your child’s learning needs are and what services will be necessary to meet those needs. IEPs contain essential details regarding the particular services needed, how long those services will be needed, and who will provide those services. Your input into its development is essential to create an individualized plan that will best suit your child’s educational needs, as well as to create a record that can be reviewed if necessary in the future – remember, a hearing officer or judge can only review what it can see. It is absolutely appropriate to request that your comments be recorded in writing and attached to your child’s IEP.

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