Guiding your life’s biggest financial moments

Personal Finance

Legal advice for parents of children in this “delicate stage” of semi-adulthood

Kiplinger logo

My son was so excited to be starting his freshman year at the University of Savannah in the fall of 2019. But COVID-19 forced the school to close right after spring break, and he will be taking Zoom classes this summer. We really enjoyed having him at home, but he will finally be able to return to campus this next fall for his junior year.

He became a legal adult before he even graduated from high school. Since he was 18 he has enjoyed all the legal rights of an adult (except the purchase of alcohol) and all legal obligations and responsibilities, but he is still in this interim period of semi-adult. He is financially dependent on us, since we pay his health and auto insurance as well as his tuition and housing costs. The Affordable Care Act requires my group health plan to cover it up to age 26, and income tax rules allow me to report it as a dependent during the period. year in which he reached the age of 24.

But since he is an adult, I cannot access his university or medical records, nor stand in his place in the context of public programs or subscriptions, contracts or private transactions, without his written authorization. And this written permission must be granted in accordance with national or federal law and, in many cases, the business requirements of the relevant institution, such as a hospital, bank or college.

What should I do if he is injured in a car accident and admitted to a hospital in Georgia? How could I monitor or direct his care? How to recover your vehicle or preserve your personal property? It’s easy to imagine the myriad situations where I would have a hard time helping her without the proper papers.

State law provides the answers through a financial power of attorney and patient advocate designation (sometimes referred to as a medical power of attorney or advance directive appeal – POA for short). His financial power of attorney gives me the authority to act on his behalf on all legal and financial matters, while the patient advocate designation gives me the authority to make medical decisions for him while he is incapacitated. In an extreme situation, even if my son has already executed the power of attorney, I may still need to apply for guardianship or trusteeship in certain circumstances, or even establish a trust for additional needs so that he can benefit from aid, but its well-written power of attorney makes this process easier.

A power of attorney with strong powers provides for the management of the principal’s legal and financial affairs with authority similar to that of a custodian, but with more freedom and latitude. Generally, an agent under a power of attorney does not have to report to the court on his actions. My adult child’s power of attorney includes the authority to manage university accounts, banking, real estate and rental contracts, retirement accounts, insurance policies, investment accounts, government rights programs, as well as creating and amending trusts and estate planning documents.

The POA specifically contains the exemptions required for the Health Insurance Portability and Accountability Act of 1996 (HIPAA). The ability to modify or create a trust for him, including a qualifying income trust and a special or additional needs trust, may be essential to his long-term care if he has an impairment or disability. severe or permanent. A document without this authority would inevitably oblige me to apply for guardianship.

Third parties, including banks and medical practices, are generally required by state law to accept POAs that have been notarized, but even still, it is advisable to present this POA to all institutions known to approval and to fill in the forms of these institutions while the main thing is to be able to give its agreement. Additionally, if your student is attending school in another state, like my son does, their POA must comply with the laws of each state in which it may be required. Therefore, it is a good idea to include two adult witnesses attesting and a notarized certification, even if your state’s law does not require such formalities, as some states still require witnesses for a power of attorney.

If my son ultimately needs to apply for Social Security Disability Insurance (SSDI), Supplemental Security Income Benefits (SSI), Medicaid, or other public assistance, I can present this power of attorney and ask to qualify as a beneficiary representative to file their claims, manage their benefits, produce their annual reports and receive tax statements and notices on their behalf.

Along with running a strong POA, I need to make sure my son has access to a strong support network in case something happens where his parents can no longer serve as his POA. A support network can include our siblings, who are ready to stand up for my adult child if we cannot. My own estate plan includes a trust that will merge with any trust that I may have to create for my son under the power of attorney, including a trust for additional needs.

The story of the Supplemental Needs Trust began with the Omnibus Reconciliation Act of 1993, which established that trusts – revocable or irrevocable, established by an individual or by court order – must be included in income or resources. available to reduce or eliminate means eligibility. -services tested unless certain rules are respected. Most government benefit programs, including Medicaid and SSI, will exempt a special needs trust as a resource if the beneficiary cannot force distributions from the trust and the trust can only be used for additional needs of the family. recipient, not for support.

To qualify under these rules, a supplementary needs trust must serve a single beneficiary for life, include specific legal terms and references, provide certain trust powers and limitations, and weigh loss of eligibility against profit. of each non-additional distribution. The various federal and state programs generally cover housing, food, utilities, medical care, and medication. An Additional Needs Trust may pay for all uncovered medical, eye, and dental care, private rehabilitation training, services or devices, additional educational assistance (including tuition and maintenance costs). education), entertainment, recreation, transportation, personal property and personal services.

The distribution rules for trusts are very strict. Structuring a trust for additional needs requires experienced guidance in state and federal program laws, a clear understanding of the state office’s interpretation of local program regulations and guidelines, a relationship informed policy makers with local programs and continuing education in this area of ​​practice and in drafting these complex trusts.

A trained trustee has the expertise to maneuver the maze of public assistance programs, knows when to seek legal advice, clearly understands how the terms of the trust and program regulations interact, and confidently determines how and when to make distributions that are clearly in the best interest of the recipient. For advice and to find qualified legal counsel for a trust for additional needs, you may consider contacting one of these organizations for assistance:

  • The Special Needs Alliance at
  • National Academy of Elder Law Attorneys at
  • The Academy of Special Needs Planners at

For advice on preparing a financial power of attorney and a patient advocate designation for your semi-adult child, you should consult your estate planning attorney or contact your local bar for a recommendation. While there are many forms online that you can purchase to do it yourself, I would advise against it if you can afford the attorney fees. While there is no guarantee that a POA will be sufficient to achieve its objectives or be accepted by the receiving party, you will have more success with a POA written by an attorney experienced with state laws that may govern its use.

You may also like...

Leave a Reply