Unfortunately, the rate of divorce is exceptionally high—80-90 percent—among families of children with special needs. It is critical that family law practitioners understand the unique issues that arise in these cases. While all divorces are emotional and fraught with concerns about both short and long-term issues, divorce proceedings for parents of a child with special needs must be viewed through the lens of the long-term realities of disability. This is particularly true for children with complex or severe disabilities, who will require lifetime supports and services. Unlike “typical” kids, these children will never outgrow their need for assistance with basic decision-making, activities of daily living, self-care, etc. However, even children with mild disabilities may require specialized planning during a divorce due to their unique needs.
When a child is a minor, and custody or parenting time is at issue in a divorce, any special needs the child has must be considered when making final decisions. Children with autism or sensory processing issues, for example, may have a more difficult time transitioning between homes regularly. One home—or parent—may be better equipped to safely manage a child’s disability-related needs due to knowledge, work scheduling issues, other individuals in the home, etc. As with all custody discussions, the “best interests of the child” should prevail. Similarly, in terms of child support, additional expenses may need to be built in beyond the mandated guidelines to account for necessary therapies, private tutoring or education, specialized medications, items not covered by insurance, etc.
But what about when a child is no longer a minor? What planning should be done during a divorce proceeding to properly prepare for lifetime issues related to the child’s disabilities?
First and foremost, parents should be informed that joint decision-making for that child will likely need to continue well past when the child turns 18. If the child is disabled, but not incapacitated, at age 18 the child may execute a General Durable Power of Attorney in favor of one or more parents to allow continued assistance with financial decision-making. Similarly, the child may execute a Health Care Proxy to allow continued assistance with health-care decisions. Note that the General Durable Power of Attorney and Health Care Proxy are purely voluntary by the child, can be revoked at any time, and the child may name somebody other than their parents in those roles.
If the child does not have the capacity to make their own decisions, guardianship or co-guardianship is also always a possibility. A guardianship is a complete substitution of the child’s right to make decisions for themselves with the guardian’s authority to make those decisions. Parents should be counseled on how co-guardianship functions to make an informed decision about whether co-guardianship will work in their circumstances. Many families find it is easier to pick one parent to act as the legal guardian to ward off constant disagreements about what is best for the (now adult) child. Non-guardian parents can be reassured that they will continue to have a very active role in their child’s life, even if they are not the guardian. Most state-funded service systems—such as Medicaid, the New Jersey Division of Developmental Disabilities (DDD), etc.—recognize the continued role of non-guardian parents in the annual service planning process. Even the parent who does not act as the guardian will often be involved in the discussion about choosing a service provider, etc. However, the legal guardian has the final say. So if a parent is concerned about being “cut off” from the process, legal guardianship is the safest bet.
New Jersey statutes, N.J.S.A. 3B: 12B et seq. and New Jersey Court Rule 4:86 govern adult guardianships (over age 18). A guardianship application is a relatively straightforward process. The complaint must identify the alleged incapacitated individual, their relatives, and their assets and debts. The application must be supported by medical or another knowledgeable opinion on the alleged incapacity of the individual, and the appropriate Case Information Statement, found on the New Jersey courts website.
If the child is not receiving DDD services, the guardianship application must contain an affidavit of two physicians, or one physician and one psychologist, who personally examined the alleged incapacitated child not more than 30 days prior to filing the complaint. The affidavit must include an opinion of the extent to which the alleged incapacitated child cannot govern or manage their own affairs, and the extent to which the alleged incapacitated person retains sufficient capacity to manage specific decisions such as residential, educational, medical, legal, vocational or financial.
If the child is receiving services from DDD, there are relaxed rules under N.J.S.A. 30:4 – 165.8 on the supporting affidavits. Here, an affidavit is required from only one practicing physician or psychologist, together with alternative affidavits, such as the director of a facility treating the alleged incapacitated individual, an approved person from DDD, a “licensed care professional” which could include nurse practitioners, physicians assistants, family counselors, occupational therapist, physical therapists, social workers, speech pathologist, etc., or a copy of the child’s Individualized Education Plan (IEP).
Given the court’s concern to maintain an individual’s fundamental right of self-determination to the extent possible, a guardianship may either be “general” or “limited.” A general or “plenary” guardianship is appropriate for a child who has no ability to make decisions for themselves. If the child has the ability to make limited decisions for themselves, such as in the areas of residential and vocational, but not necessarily medical, legal and financial, a limited guardianship may be appropriate. The physician certifications required as part of the guardianship complaint will speak directly to the alleged incapacitated child’s ability to make decisions in certain areas of their life, and inability to decide in others.
Besides the typical legal and medical decision-making that comes with guardianship, the parent or guardian of an adult with disabilities will often be responsible to: (1) sign the annual state-funded service plan for whatever disability services the child receives; (2) sign the lease or tenancy agreement if they reside in a supported residential placement; (3) act as the representative payee for Social Security Income (this is optional but common); and (4) act as the point of contact for the case management entities that must interact with the individual.
In considering divorce, and division of assets, parents must also give significant consideration to the child’s finances after the child attains age 18. To qualify for supports and services from DDD, the child must be qualified to receive Medicaid, which requires that the child is deemed disabled and qualified to receive Social Security Income (SSI).
SSI is a needs-based benefit. If the child has too much income, or too much in resources (generally $2,000 in New Jersey) then the child will be financially ineligible to receive SSI. If the child cannot receive SSI, then they cannot receive Medicaid, and cannot qualify for DDD services. The child’s assets must be limited to maintain qualification for SSI.
However, limiting the child’s assets may be contrary to the parents’ desire within the divorce proceedings to provide lifetime security for the disabled child. Parents should consider creating and funding a third-party Supplemental Benefits Trust (SBT) for the disabled child as part of the divorce settlement.
A Supplemental Benefits Trust is a trust created by someone other than the disabled child with assets other than the disabled child’s. The SBT is drafted so the assets are available to the child in the trustee’s discretion but do not interfere with the child’s ability to obtain SSI, Medicaid and DDD services. Some key considerations:
- Grantor: One or both parents could be the “grantor” or creator of the SBT. Thought must be given to the income tax implications of the SBT and if it should be its own taxpayer, or if one parent should be the taxpayer.
- Trustee: The trustee will invest and distribute the SBT funds so they do not interfere with the child’s SSI, Medicaid and DDD benefits. If the parents cannot agree on this role, an outside trustee may be appropriate.
- Funding: The SBT could be funded during the divorce, on an ongoing basis, or at a future event. For example, one or both parents could be required under any settlement agreement to contribute funds to the SBT on a scheduled basis, or to maintain life insurance with payment to be made to the SBT upon death of the parent.
Children with special needs continue to need their parents’ support well beyond the age of majority. Family law attorneys must consider substituted decision-making for the children, long-term financial needs, eligibility for benefits programs, and tax issues. Best practices in these representations will include adding a special-needs attorney to the legal team.
Deirdre R. Wheatley-Liss is a principal at Porzio Bromberg & Newman in Morristown. Elizabeth M. Shea is of counsel to the firm.