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Articles Tagged with bronx elder law

When we place our loved ones in the care of a nursing home we expect that they will be properly treated and cared for. Sadly, there are many instances where negligent care is given. In one recent case, a nursing home resident was seriously injured after being scaled by hot water that was spilled on her. The woman’s health declined and she died. A representative for the woman’s estate has filed a lawsuit in stating that they did not provide proper care to her.

Burns Can Be Serious

Burns to the skin can occur for a number of reasons. In this case, the woman suffered burns due to hot water that was spilled. The nursing home staff allegedly did not properly supervise the woman while under their care. The woman sustained severe physical injuries that contributed to her death. Burns are painful, and may become infected, causing other medical problems. In this instance, the lawsuit alleges that the burns were quite severe and indeed led to the woman’s decline in health, and subsequent death.

Blind Trusts

Blind trusts are another type of trust that is established in order to set assets aside and preserve them for a specific period of time, however the person establishing the trust has no control over the  funds and thus does not receive access to them. Additionally, the individual also does not receive periodic reporting of the assets held in trust and their investments.

Blind trusts are a type of irrevocable trust, meaning that the beneficiary does not have any control over the administration or distribution of the trust or its terms. The person establishing the trust relinquishes his or her rights to make decisions and gives the trustees, those people who are now in charge of managing and handling the assets, full power to make decisions. The maker of the trust only has the power to establish the trust and to terminate it.

CERTAIN LIMITATIONS ON SPECIAL NEEDS TRUSTS

Last year a case out of the Western District of Massachusetts Federal District Court dealt with the interplay of a special needs trust and eligibility for certain governmental benefits that the special needs trust was supposed to address. The case of DeCambre v. Brookline Housing Authority dealt with the beneficiary of a valid special needs trust who applied for a section eight housing voucher but was denied because of income that she received from a third party special needs trust, established by a Court. Ms. DeCambre was involved in a catastrophic accident which resulted in a series of settlements, with the proceeds directly deposited into the special needs trust. She received a total of $330,000.

The trust did not earn any income of it’s own, the truste only distributed the income in line with the terms of the trust and charged the normal and typical trustee fees. Ms. DeCambre did not have any control over the distribution of the income or money in the trust. The Court noted that the special needs trust was indeed valid and in conformity with the special needs trust enabling statute, found at 42 U.S.C. § 1396p(d)(4)(A) and (C). Indeed, the Court noted that Ms. DeCambre benefited from this trust insofar as she received Supplemental Security Income of approximately $850 per month and validly received Medicaid. These programs, the Court noted, specifically excluded the income from the a valid special needs trust. Ms. DeCambre applied for a section eight housing voucher through the Department of Housing and Urban Development (HUD) in 2005. The voucher was approved and provided from 2005 through to 2012, when HUD reduced it by approximately $1,000 per month, based on her income from the special needs trust. Ms. DeCambre sued HUD in Federal Court on several statutory grounds, based on HUD’s decision to reduce the amount of her housing voucher.

There is a relatively unknown or at least underutilized program in the law that can provide some important tax benefits for those who care for their elderly or special needs relatives.  The Dependent Care Assistance Program (DCAP) is a tax benefit that is often offered by employers for expenses that a person incurs for any number of things for the care of others.  It is a tax credit that can be claimed by the taxpayer for expenses related to the care for qualifying individuals so that the caretaker may work.  The program is similar to a Health savings account insofar as a person can sock away a certain amount of money that can be used on certain delineated services or costs.  

The good thing for New Yorkers is that this tax credit is for both federal government income taxes as well as state taxes.  Not all states have such a tax credit; residents of these states can only utilize the federal credit and still have to pay state taxes on the money earned and diverted into the DCAP account.  Under federal tax law, the tax credit is limited by to the amount that the worker earns.  New York’s tax credit calculated as a percentage of the Federal tax credit.  In addition, there is a $5,250 ceiling per year on the amount that a person can put into the account.  The benefit is allowed for families earning up to $120,000.  If the employee utilizes a DCAP program through their work, the tax credit is reduced by the amount that use through their employer’s program.

The money can be used for practically anything for the elderly or special needs relative, including adult day care, transportation, (reasonable) entertainment costs, as long as they costs are related to your employment.  In other words, if you do not need to incur the costs to be employed, you cannot claim these costs.  Overnight camp or educational costs cannot be incurred, since they are not related to or required to your employment.  Fellow relatives cannot be the service provider.  While an employee can take advantage of an employer based program, most employers do not offer it as an additional benefit; rather most employers who have such a program allow the employee to earn their income tax free.  

HOST OF BENEFITS OFFERED

There are a number of benefits that the Federal Veterans Administration offers to eligible veterans and their families. While the vast majority of benefits require an eligible veteran or his/her spouse to obtain benefits, there are some limited circumstances when the children, including adult children, may be eligible. Children born with a number of ailments, although mainly spina bifida and conditions secondary to spina bifida, that are direct biological issue of a veteran of the Vietnam war era and who served in country may be eligible for a disability pension. Children of medal of honor winners receive a host of benefits throughout their lifetime, although not all of them are administered by the Veterans Administration. For veterans or their spouses, while not exhaustive, the main benefits that most veterans apply for and receive are:

  1. a military retirement; or

WHAT IS BEST FIT

Both an ABLE Act account and a special needs trusts try to accomplish essentially the same thing. Both attempt to ensure that a special needs child or person are financially planned for through various legal and financial means so as to enrich the life of the beneficiary. An ABLE Act account as well as a special needs trust also aim to protect the beneficiaries valuable governmental benefits that utilize a means based testing for eligibility purposes. While both products roughly accomplish the same thing, one may be better at accomplishing one thing rather than the other.

TWO DIFFERENT MEANS TO ONE END

To be sure, tontines are illegal in America and have been since the early 1900s. There have been many articles of late, however, arguing for their return and putting the product back onto the menu of options that retirees may want to purchase. The idea of the tontine is rather simple. You get a group of people who all buy into the tontine, with their money going into the collective pool of cash. At certain intervals, you get paid money back. When people in the pool pass away, the money they invested does not go back to the investor’s family or estate. Instead it stays in the pool, allowing the payment to the remaining members to increase. The offensive part comes from the financial gain garnered by another’s death. Some people may view it as gambling on the lives of another.

REGULATORY SCHEME OUTLAWING TONTINES

In 1905 the New York based Equitable Life insurance company internal fight went public with accusations of self serving deals and political payoffs. In response New York launched a far reaching investigation that helped to shape insurance law for the next century. The Armstrong Committee started the career of future United States Chief Justice Charles Evans Hughes, who was a rabid opponent of gambling and helped to create the picture in the public that tontines are gambling. He further helped to draft the 400 plus pages of recommendations and reforms. At the time, New York had jurisdiction over 95 percent of the insurance industry in America. Moreover, within ten years most states enacted similar legislation. As such, the impact was national in scope. Among the reforms enacted was a prohibition on rebates by insurance companies and a ban on deferred dividend insurance.

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