Mentally ill SIL and the will
This is step related because it's about DH's half sister from his mothers second marriage, a stretch I know 
MIL is in her 80's, poor health, homebound, and has finally decided to start outlining her will. So far all assets will be split 4 ways between DH and his 3 sisters. Youngest sister will not be named as a direct beneficiary yet the assets are supposed to be held for her and distributed by the older 3 for her care. There is a clause about this in the will outline. Youngest SIL is mentally ill, still living with MIL and on SSI and Medicaid.
I asked DH if this would disqualify her for SSI and Medicare since technically she would be recieving over $2k in assets intended for her. He said NO because she is not directly named as a direct beneficiary. I'm concerned that she may indeed get disqualified and no longer be ineligable for benefits due to hiding assets. Not that she would be the one hiding assets but the family kinda is.
The main asset is MIL's house which has a 40k balance from a 2nd mortgage and has a significant amt of damage, mold and repairs that need to be made. I'm guestimating that the full amt youngest SIL would get after all debts are paid and everyone gets their slice is about $30k. In the grand scheme this is very little and wouldn't support her for long. I'm thinking that mentioning her at all in the will as even an indirect beneficiary would be too risky. They'll have a lawyer draft it up but I know many lawyers are not Social Security experts.
Anyone have any legal knowledge or experience with this kind of situation?
Just read something recently
Just read something recently about a new program which is similar to a 529 college plan which would allow folks to put funds into an account for special needs/disabled people. New account will not affect SSI & Medicare requirements. Has a trustee, I believe. I'll look and see if I can find the link to the article. Perhaps it's only in my state or perhaps it's some new gov't program.
Is the trust completely
Is the trust completely separate from the will or is it mentioned in the will that a trust will be set up for SIL?
I just hope that all of this is resolved before MIL passes. She's been dragging her feet on this issue. MIL just assumes that all the siblings will step up to care for youngest SIL. SIL has her moments of lucidity but for the most part she is difficult to deal w/and mentally about 12 years old. DH is willing to help out but there is no way he physically or mentally can care for her. Oldest SIL will advise from a distance but has washed her hands of the situation and refuses to have much to do with it. Other SIL just older than DH has been main caretaker of MIL and SIL but she recently took ill and has been out of commission for a few weeks leaving it all to DH. He's freaking out because he realizes that he's next in line to inherit this situation if something happens to older SIL.
I'll mention your advice to DH. I'd hate for this to fall into probate, SIL get her cut and be disqualified for Medicaid/SSI for many years.
Yes I agree she should have
Yes I agree she should have more too but MIL will do what shes gonna do. Having her get to drafting a will at all has been a chore for DH and his sisters. All the siblings are nice but middle SIL has always been poor and gotten herself into financial messes so I am concerned about her being in charge of a money for youngest SIL. I know DH would be fine with giving SIL more especially if it meant someone else taking care of her affairs.
Right now it seems like MIL is trying to set up a trust through her will with all the siblings in charge. I have no idea if this will work or just be a legal headache in the long term. DH is not thrilled, he wants SIL to be cared for but wants no part in the legal end of it.
I think this is the best way.
I think this is the best way. And by doing this you are looking out for your other kids too by not burdening them with a large financial responsibility for their brother. You are being fair to them all, which does not have to mean treating them all equally.
My best friend has a daughter
My best friend has a daughter who is mentally disabled. They have a trust set up for her as well. When they pass, the money is put in trust and set up in a way it will not interfere with her benefits.
Make sure you get a lawyer
Make sure you get a lawyer that specializes in Special Needs Trusts. They are much more complicated than the average will or trust.
I'll mention this to DH.
I'll mention this to DH. Hopefully MIL will listen to him. She's been reluctant to do anything because she's afraid it'll hasten her death but her inaction is catching up to her.
***something else to think
***something else to think about***in addition to everything else...
Also please keep in mind that this 80year old Mom may require assisted living grandfathered into long term care. It is difficult to think about. I have been there
Yes I know so many families say WE will keep her in her home forever. Sometimes it does not work out that way especially if she becomes ill OR has a fall requiring her to go into the hospital. After the hospital she will have rehab and IF she is unable to meet certain requirements she may need extended help either in home $$$$$ or assisted living etc.
Gosh this is hard, all of it is very hard. I am sorry.
Your best bet is to talk to a lawyer---if MOM has great health maybe she will live very long
IF not and takes ill,,,everything may be wiped out. She is best to try to gift $$ now to everyone. Ask a lawyer about max per person per year.FYI nursing home can look back 7 years fyi and they will scrutinize her accounts and assets.
This is something I talked
This is something I talked about w/DH when we first married. He told me that he will inherit his moms old classic car and it'll be signed over to him in the will. I mentioned to DH that if she does have to enter a nursing home then they can take ALL of her resources to pay the costs, including the car, this was 5 yrs ago we had that discussion. MIL was in poor shape then and now it's only gotten worse. I suggested she sign it over right then but what do I know :?
DH and his siblings will do everything they can to keep MIL in her home. So far it's working, but yes there may come a time when it's not enough. middle sister has already fallen ill and can't do her daily care so now it's left to DH who is much more hands off. She has a visting nurse who comes in and a lady who cleans the house. Do you know if MIL got bad enough and her children were not able to care for her enough would the nurse *order* that she be removed from the home and put into long term care?
I have a feeling of impending doom about the whole situation and have been sharing everything I learn with DH but the family all have their heads in the sand and legal matters are moving at a snails pace while MIL gets more decrepit.
A special needs trust would
A special needs trust would be best, and MIL should assign a third party (like a bank or trust company) as trustee since they have experience in administering them. They are VERY complicated and the rules regarding what and how the funds are distributed are very confusing and having someone without a clue be trustee could cause a whole host of problems for her re: government benefits.
There are qualifiers that
There are qualifiers that work for distributing assets used to support a dependent person that can prevent DQ from benefits.
In my GM's case after my GF passed and their assets were liquidated the assets were split equally between my dad, brother, and I for the support of my GM. Because the assets were distributed a number of years prior to their use to support my GM they were not subject to consideration or confiscation by the SSA for the direct support of my GM. This allowed us to use those assets to augment my GM's quality of life rather than allowing the SSA to use them to warehouse her in some minimal care facility.
Her SS benefits were used to cover the majority of her basic care costs and then as a family we used the distributed assets to upgrade the facility where she lived the last years of her life. She loved it. This allowed us to maximize her SS benefits as well as her quality of care and quality of life. GM had a great time the last half dozen years of her life in a wonderful facility with great staff and a very active social life.
We worked it out with our attorney. Your DH and his sibs should do the same to make sure that they are complying with the law while protecting their sisters best interests and their mothers wishes.
IMHO of course.
It sounds like your situation
It sounds like your situation worked out perfectly because there was preplanning done years ahead, kudos to your grandfather. In our situation nothing will be liquidated until MIL passes. As far as I know the *will* is still just being talked about and not yet finalized. It's all up in the air and MIL has this grand idea that DH and siblings will give up their lives for their youngest half sibling just like she did. Middle SIL might but her health is failing, DH and his other sister want little to do w/the situation other than writing a check once in a while since youngest sister is very difficult to deal w/at times and well above their pay grade.
I'm hoping it all gets finalized soon and in the proper way so SIL is supported after MIL passes. Thanks for your insight.
It sounds like your situation
It sounds like your situation worked out perfectly because there was preplanning done years ahead, kudos to your grandfather. In our situation nothing will be liquidated until MIL passes. As far as I know the *will* is still just being talked about and not yet finalized. It's all up in the air and MIL has this grand idea that DH and siblings will give up their lives for their youngest half sibling just like she did. Middle SIL might but her health is failing, DH and his other sister want little to do w/the situation other than writing a check once in a while since youngest sister is very difficult to deal w/at times and well above their pay grade.
I'm hoping it all gets finalized soon and in the proper way so SIL is supported after MIL passes. Thanks for your insight.