With the holidays approaching, I know the dread of many siblings of adults with special needs: what am I going to get my brother?! For parents of children with special needs that question can be even more daunting because their children’s development may be advanced in one area and delayed in a another which makes finding a toy that’s both challenging enough to be engaging and easy enough to be enjoyed is tough.

Toys R Us is now distributing a guide developed specifically to address choosing the right toys for kids with special needs . 600,000 of the “Toy Guide for Differently Abled Kids” will be printed and available at Toys R Us. Of the 85 toys listed inside, 79 can be obtained at stores other than Toys R Us. The guide indicates for each toy, which developmental area it can stimulate.

You can even look at it online right now!

In a private letter ruling recently, the IRS addressed the issue of transferring an inherited IRA into a Special Needs Trust. The law around taxation of inherited IRAs and the interaction with trusts has been unpredictable and fast-moving for several years now.

Fortunately, this private letter ruling indicates the direction the IRS is headed on two important questions:

First, the transfer to the SNT was not a taxable transfer for estate and gift tax purposes. That’s great! It means that if a person with special needs inherits an IRA, we can still do some limited planning without immediate tax consequences.

Second, the trustee was able to stretch out the distributions from the IRA (and therefore stretch out the tax deferral benefits) over the life expectancy of the beneficiary. Another positive result.

Of course, the best result would have been achieved if the decedent had made the IRA payable to the SNT directly. That way, court costs, private letter ruling costs, anxiety, and a “pay back to the state” provision all could have been avoided.

For those of you who enjoy a humorous but substantial approach to advocacy, check out Mothers From Hell 2 .

I am delighted to announce the formation of a ground-breaking organization: The Academy of Special Needs Planners.

Harry Margolis (Managing Partner of Margolis & Associates, a Boston law firm, and founder of Elder Law Answers ), Vincent Russo (Managing Shareholder of Vincent J. Russo & Assocates, a New York law firm, and past-President of The National Academy of Elder Law Attorneys ) and I have joined forces to create The Academy of Special Needs Planners (“ASNP”). ASNP is a national member organization of attorneys who are dedicated to improving the lives of people with special needs by helping them and their families plan for the future.

The Academy’s website connects families with attorneys who are experts in providing legal guidance and services that enhance the lives of their loved ones with special needs. Our new organiation offers information, education, networking and assistance to our member attorneys, to other professionals concerned with special needs planning, and to families of people with special needs.

As my co-Founder, Vince Russo, says, “Clients need attorneys who combine compassion with skilled estate planning and knowledge of the public benefits programs on which many individuals with special needs must rely.”

Does your child or family member with Autism or Asperger’s appreciate reminders? Does he like repetition of social cues, like “make eye contact”? My brother has a list of things he likes to be reminded of in particular situations. For example, when he’s at the airport, he likes to be reminded, repeatedly, not to make jokes about hijacking. He gets very worried that he might say something inappropriate.

My parents and I have always acted as his reminder system. We all know the scripts. When he asks about an imponderable, like why he gets upset by barking dogs, he wants the answer “Why does Scott hit?” (Scott was a classmate who, much to Nathan’s distress, could not seem to control his hitting.)

Unfortunately for Nathan, we are not always with him. This must be one of the reasons he is unwilling to be in stressful situations without family present.

The Boston Globe has written an article on a new technology that helps people with Asperger’s and Autism to remember the social cues and scripts using a hand-held PDA. I think it can be applied to all sorts of reminders. To read the story, Click Here . To check out the technology company’s website, go to Symtrend.

When creating a special needs trust, parents must take into account not just where the beneficiary lives now, but where she might live in the future. Because state laws vary on the level of services provided and on what special needs trust provisions will be respected, we build lots of flexibility into our trusts to address these differences.

Some clients have asked me, when choosing between good guardians in different states, whether the services in one state are dramatically different from the services in the other. Until now, I have not had a comprehensive resource to help me answer that question.

The National Alliance for the Mentally Ill (NAMI) has recently released the first state-by-state rankings of services and infrastructure to support the mentally ill in 15 years. (While those with developmental or injury-related disabilities have different challenges, many of the infrastructure issues are the same for all three groups.)

Read on to learn more about California, which states are best, which states are worst, and what to do about it for your child.

California’s grade is “C” which is above the national average “D” but not as great as states like Wisconsin, Ohio, Connecticut, Maine, and South Carolina. No state received an “A”. Most distressing, California received a “D” for services — perhaps the most important category.

If your guardian lives in one of the states ranked “F”, it may be time to revisit your choice. Those states are: Idaho, Montana, North Dakota, South Dakota, Kansas, Iowa, Illinois and Kentucky.

For clients who would like to revisit their choice of guardians in light of this newly released resource, or new clients who’d like to learn more about how to protect their children, we invite you to call Anna Spektor, our Director of Community Relations, at (805) 778-0600 to schedule an appointment.

People with autism are more intelligent and better able to function than previously believed. The erroneous beliefs come from biased test and a long history of assumptions. IQ tests used to estimate the intelligence of people with autism have relied heavily on verbal abilities, which in many cases lag far behind other forms of intelligence, such as spatial and logical.

Go to the Social Security Administration to see the new eligibility and penalty figures for Supplemental Security Income recipients in 2006. Or just read here!

Maximum benefits for California recipients will be $836 per month (the federal benefit is only $603 but California and some other states provide supplements to increase the benefit level).

The maximum reduction for recept of “stuff” (in-kind support and maintenance — not cash) is $221. That means that if a parent or a special needs trust buys stuff for an SSI recipient, that recipient will have his or her $836 reduced dollar for dollar for the value of those benefits but only up to a maximum of $221.00. So a person with a special needs trust that spends $225 or $2,000 or $20,000 per month on her will still receive an SSI benefit of $615 ($836 minus $221).

Thanks to Steve Dale of The Dale Law Firm for the link!

The United States Supreme Court ruled in Lockhart v. U.S., 04-881 that student loans can be collected through garnishment of up to fifteen percent (15%) of Social Security benefit payments. Because the ruling covers disability as well as retirement benefits, recovery may be made against SSDI (Social Security Disability Income — payable to disabled adults whose parents paid into the Social Security system) and SSI (Supplemental Security Income — payable to those with almost no income or assets) as well as traditional retirement Social Security.

Further, in 1996, Congress removed the statute of limitations on recovery of defaulted student loans. So people who attend school then become disabled and unable to work may have their very limited public benefits further reduced to repay their student loans.

Money left or given to a disabled person in a Special Needs Trusts is not impacted by this ruling and is still safe from attachment.

It is possible that Congress will reconsider this issue, as lower courts have been divided on whether student loans can be collected against Social Security benefits.

Nolo Press, publisher of a wide array of self-help books, has recently released Special Needs Trusts: Protect Your Child’s Financial Future by Stephen Elias. Not a specialist in this area, Attorney Elias has written a number of books for Nolo on a wide range of legal topics including How to File for Chapter 7 Bankruptcy, Getting Paid: How to Collect from Bankrupt Debtors, The Independent Paralegal’s Handbook: Everything You Need to Run a Business Preparing Legal Paperwork for the Public, and Collect Your Court Judgment (How to Collect When You Win a Lawsuit), A Dictionary of Patent, Copyright and Trademark Terms, and The Living Together Handbook.

While the book provides a user-friendly overview and can be helpful in illustrating the effects of inheritances and income on government benefits, it has a number of serious shortcomings.

The shortcomings are perhaps related to the limited target audience of the book: people with small special needs trusts. Of sixteen examples that mention specific dollar figures, not one is over $300,000. The average example cited has less than $125,000 in it.

The book is filled with warnings including the repeated suggestion that readers keep up with legal changes and may want to work with a lawyer to do so. It also mentions the fact that trusts should take account of the many differences between states.

The author also acknowledges several situations where the Nolo boilerplate trust won’t work, most notably:

• If you want the trust to be able to receive gifts from other members of your family
• If your child has money of his or her own (such as from an inheritance or settlement)
• If you want to customize your trust in any way. Nolo says don’t change the trust language at all.
• If you want to name a corporate trustee in your trust (always a good idea at some point in your child’s life because most of the people that you think will be good trustees will be too old to take care of your child long after you are gone).

Unfortunately for readers, the author fails to acknowledge many other situations where the trust won’t work. Here are a few of the traps for the unwary that the author does not warn the reader about.

• Many worthy pooled trusts that are available only through attorneys
• The Nolo boilerplate trust includes avoidable risk that trustee will foolishly terminate the trust while your child still needs it
• Your child cannot benefit from your retirement accounts such as IRAs and 401(k)s using the Nolo trust without negative (and perhaps severe) consequences for taxes and benefits eligibility.

The Nolo boilerplate trust is a scant 6 pages. The trust I created for my own brother is 65 pages. I didn’t make it long as an excuse to write late into the night every night. It’s long because it’s complete.

When the author acknowledged that “Almost without exception, special needs trust lawyers think people shouldn’t create special needs trusts themselves,” I was left to wonder why readers would scrimp on the one tool that will provide for their child’s lifetime care after they are gone and can do nothing more for that child.