When establishing a trust, it is important to
understand the role of the Trustee and the
responsibilities of this position. The following are
the principles that guide the Trustee:
Accounting – The Beneficiary of the trust and their legal representative (such as an agent under a durable Power of Attorney, Guardian or Conservator) and the Advocate are entitled to an accounting from the Trustee. Accountings are prepared on a quarterly basis and can be accessed through the internet.
"Beneficiary of the Trust" – The Beneficiary of the trust is the person for whose benefit the trust was created; however, the Beneficiary does not own the funds in the trust. The Trustee has the legal ownership of the trust funds. Although the Beneficiary, or someone acting on behalf of the Beneficiary (e.g., designated Advocate), has the right to request payment to vendors by the Trustee, the Trustee is not required to approve the request. At the same time, however, the Trustee has a responsibility to ensure that the trust funds are available for supplemental needs that will improve, to the extent possible, the quality of life of the Beneficiary.
"The Duty to Be Generally Prudent" – The Trustee has the duty to be prudent. It is the Fiduciary's responsibility to safeguard the trust property for the Beneficiary.
Fiduciary – Another name for a Trustee is "Fiduciary." A Fiduciary acts on behalf of the Beneficiary of a trust fund and is held to the highest standards of loyalty and competence in the administration of the trust.
"Pro Rata Share" – If the trust makes distributions that incidentally benefit other persons, then those persons must contribute a pro rata share of the expense. For example, if the Trustee purchases a van to share with others at a group home, then other riders should pay a fee to use it.
"Protection of Benefits" – The trust has been drafted in such a way that, provided the Trustee follows certain guidelines, the Beneficiary will continue to be eligible for Medicaid and Supplemental Security Income (SSI). Although the recipient of the trust does not have legal title to the trust funds, the recipient is what the law calls the "Beneficiary" of the trust. This means that the Department of Social Services for Medicaid recipients and the Social Security Administration for SSI recipients are notified of any deposits made to the trust and of distributions made from the trust. Generally, the following distributions would impact SSI benefits: food, mortgage (principal and interest), rent, real estate taxes, gas, electricity, water, sewer, homeowner's insurance and cash payments to the Beneficiary. There are additional rules for both Medicaid and SSI that are complicated and rigorous.
"Sole Benefit Of" – Any distributions from the trust must be for the sole benefit of the Beneficiary, the person for whom the trust is intended to benefit. Distributions from the trust must be limited to those that benefit only the Beneficiary and not any other person. If a trust provides benefits to other persons, then it will not be considered a special needs trust, it will become a countable resource, and the Beneficiary may lose government benefits.
Accounting – The Beneficiary of the trust and their legal representative (such as an agent under a durable Power of Attorney, Guardian or Conservator) and the Advocate are entitled to an accounting from the Trustee. Accountings are prepared on a quarterly basis and can be accessed through the internet.
"Beneficiary of the Trust" – The Beneficiary of the trust is the person for whose benefit the trust was created; however, the Beneficiary does not own the funds in the trust. The Trustee has the legal ownership of the trust funds. Although the Beneficiary, or someone acting on behalf of the Beneficiary (e.g., designated Advocate), has the right to request payment to vendors by the Trustee, the Trustee is not required to approve the request. At the same time, however, the Trustee has a responsibility to ensure that the trust funds are available for supplemental needs that will improve, to the extent possible, the quality of life of the Beneficiary.
"The Duty to Be Generally Prudent" – The Trustee has the duty to be prudent. It is the Fiduciary's responsibility to safeguard the trust property for the Beneficiary.
Fiduciary – Another name for a Trustee is "Fiduciary." A Fiduciary acts on behalf of the Beneficiary of a trust fund and is held to the highest standards of loyalty and competence in the administration of the trust.
"Pro Rata Share" – If the trust makes distributions that incidentally benefit other persons, then those persons must contribute a pro rata share of the expense. For example, if the Trustee purchases a van to share with others at a group home, then other riders should pay a fee to use it.
"Protection of Benefits" – The trust has been drafted in such a way that, provided the Trustee follows certain guidelines, the Beneficiary will continue to be eligible for Medicaid and Supplemental Security Income (SSI). Although the recipient of the trust does not have legal title to the trust funds, the recipient is what the law calls the "Beneficiary" of the trust. This means that the Department of Social Services for Medicaid recipients and the Social Security Administration for SSI recipients are notified of any deposits made to the trust and of distributions made from the trust. Generally, the following distributions would impact SSI benefits: food, mortgage (principal and interest), rent, real estate taxes, gas, electricity, water, sewer, homeowner's insurance and cash payments to the Beneficiary. There are additional rules for both Medicaid and SSI that are complicated and rigorous.
"Sole Benefit Of" – Any distributions from the trust must be for the sole benefit of the Beneficiary, the person for whom the trust is intended to benefit. Distributions from the trust must be limited to those that benefit only the Beneficiary and not any other person. If a trust provides benefits to other persons, then it will not be considered a special needs trust, it will become a countable resource, and the Beneficiary may lose government benefits.
