Alex What does a trustee of a special needs trust do?
A trustee typically manages the day-to-day operations of the trust, often making distributions to the trust’s beneficiary, investing the trust’s assets, and paying the trust’s bills – all while maintaining the beneficiary’s eligibility for public benefits programs.
What is the difference between a special needs trust and a Supplemental Needs Trust?
The term “special needs trust” refers to the purpose of the trust — to pay for the beneficiary’s unique or special needs. In short, the name is focused more on the beneficiary, while the name “supplemental needs trust” addresses the shortfalls of our public benefits programs.
What are the rules for a special needs trust?
Also, this discussion does not address special needs trusts, which are generally a whole other matter. But in a nutshell here they are: Medicaid has rules regarding what assets will be counted for purposes of determining whether someone will qualify for Medicaid. Some trusts will count; others won’t.
What kind of trust does my dad have?
Mom and Dad set up an irrevocable trust years ago (Bill Clinton was on his first term) and put land and some other assets in the trust. Are the assets in the trust safe? Dad has a revocable trust (although the front page says it is a “living trust”) he set-up several years ago. How will Medicaid treat that trust?
What are the rules for a trust and Medicaid?
If Mom or Dad set the trust up and it says to distribute the income to Mom or Dad, but never to distribute principal to Mom or Dad (well . . . maybe the trustee could distribute principal to other people, just not Mom and Dad), Medicaid will count the income . . . but not the principal.
When do you need a special needs trust?
The trust must be funded with the assets of the individual who is disabled and must be created for his or her benefit by a parent, a grandparent, or a legal guardian of the individual or a court. The trust must be for the sole benefit of the individual who is disabled.
Mom and Dad set up an irrevocable trust years ago (Bill Clinton was on his first term) and put land and some other assets in the trust. Are the assets in the trust safe? Dad has a revocable trust (although the front page says it is a “living trust”) he set-up several years ago. How will Medicaid treat that trust?
Is there payback to Medicaid in a special needs trust?
Further, there is no payback to Medicaid which allows the Settlor (the third party who established the Trust) to control the disposition of the trust assets upon demise of the beneficiary.
Can a court dissolve a special needs trust?
A trust beneficiary can petition the court to dissolve a trust and distribute the assets. In order to prevail on such a petition, the beneficiary needs to be able to show the court that the need for the trust no longer exists (or perhaps never did).