Magazine article The Exceptional Parent

An Affordable Proposal for Guardianship: The Special Needs Tax Credit Bill

Magazine article The Exceptional Parent

An Affordable Proposal for Guardianship: The Special Needs Tax Credit Bill

Article excerpt

The mom's anguished question was, "Why do I have to pay $5,000 to speak for my 18-year-old with autism?" I then stood up and asked "Why can't we get a tax refund for that amount?" The whole room went silent. In that moment, the idea for the Special Needs Tax Credit was born.

It was November of 2006, and my lovely wife, Karen, and I were attending a guardianship conference in Ft. Lauderdale. The room was filled with a veritable "Who's Who" of South Florida elder Law attorneys and professional guardians. We attended as Prosperity Life Planning (www.prosperitylifeplanning. org) our small, educational nonprofit organization, through which we educate and advocate for parents through the special needs planning process with area attorneys, benefit consultants, tax and investment professionals.

I had been working with these families for just over two years at that time, and found the challenge of implementing the legal, social, and financial planning resources for special needs families to be my calling. Unlike New York, where my stepson with autism, Ricky, lives in a wonderful group home, paid entirely by Medicaid, Florida families are hard-pressed to find benefits for supports and therapies. The "Med-Waiver" program has 17,000 families on its waiting list. Med-Waiver provides for non-medical but supportive services, such as housing, transportation, therapies, "day-hab" training, summer programs and respite.

Through our numerous free consultations, we met families with one, two, even three young adults with special needs; parents who were surprised to learn they were no longer the legal guardians of their 18-year-olds or older kids. Surprise turned to shock when they learned that full guardianship might cost $5,000 in attorney, specialist and court fees.

There they were, with kids who couldn't speak for themselves, kids who lacked the judgment to make legal, health care or financial decisions for themselves, and parents unable to afford the $5,000 expense to speak for their child. A real "Catch-22."

We immediately began a petition drive through our planning workshops and our website. Everyone agreed it was a common-sense idea; that MY taxes could come back to me as a tax refund for the legal expenses of setting up a protective guardianship for MY own child.

With Karen being a tax expert and accountant, and having her Certified Financial Planner[TM] designation, we talked about how this could work. A "refundable tax credit" from the IRS would be available for someone who paid the expense for guardianship and/ or a Special Needs Trust, up to a maximum amount of $5,000. This would reduce their taxes owed dollar-for-dollar, and a check issued for any remaining balance over their taxes due. This method would especially benefit lower income families, who might not pay as much in taxes, and receive a refund for the difference, much like the Earned Income Credit or the Additional Child Tax Credit currently provide.

On September 11, 2008, we went to Washington, DC, and met with the legislative assistant to my local representative, Congressman Robert Wexler (D-19th Cong. District--Boca Raton). We discussed the problem and introduced him to our proposal. In May, 2009, I received notice that Congressman Wexler would sponsor legislation to create the Special Needs Tax Credit proposal as we envisioned. Language for the bill has been completed, and a Republican co-sponsor has been identified. …

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