Special Needs Trust

A Special Needs Trust can be established by the Court to receive assets belonging to, or are otherwise payable to, a minor or an incompetent with special needs.  To do so, the Probate Court must make a determination that establishing the trust will be in the minor’s or ward’s best interest.

Typically, a guardian of the estate is first appointed for the minor or incompetent and then the guardian can apply for the approval of the creation of the Special Needs Trust.  The purpose of the Special Needs Trust is to hold the assets in a manner whereby those assets are not counted as “available resources” of the minor or ward when determining the individual’s eligibility for governmental need-based assistance.

The Special Needs Trust will be administered and supervised as any other trust created through the Probate Court.  A bond will be required for the Trustee, unless the bond is waived according to law through the deposit of the assets of the trust in a restricted access l depository account accessible only with express approval of the Court, the trustee is a trust company, or the trust asset is solely a structured settlement contract that is not in a payment status (bond will be required when payments commence).

The applicant must have an Attorney.

Items necessary to Create a Special Needs Trust –

  1. An udigned copy of the proposed Special Needs Trust in DRAFT form; the trust must comply with Local Rule 78.7;
  2. Copy of Driver’s License or Government issued picture ID of the Applicant;
  3. Completion of forms required for Court's background check of Applicant;
  4. The base court cost deposit is one hundred twenty dollars ($120.00);
  5. Application for Appointment of Trustee and Trustee's Acceptance;
  6. Oath of Trustee (to be executed in the presence of a judicial officer of the Court); and
  7. Instructions for Service with list of names and addresses of Next of Kin of beneficiary and proposed Trustee.

 

Frequently Asked Questions

What Involvement does the Court have when a Disability Trust is Created from Funds Belonging to the Disabled Person (Adult or Minor)?
A Wholly Discretionary Trust, a Supplemental Services Trust, or a Medicaid Payback Trust can be created by third parties using their own funds without probate court involvement, unless created through a will as a form of a testamentary trust.

If a Medicaid Payback Trust (other than a Pooled Medicaid Payback Trust) is being created by the guardian of the estate of an individual under guardianship, or for a disabled minor when the funding is coming from the minor’s assets (inheritance, gift, life insurance proceeds, annuity benefits from a deceased person or recoveries from a personal injury claim), then the approval of the probate court MUST be obtained.  It is intended to hold and expend assets of the beneficiary in such a way that the beneficiary’s life is enriched and enhanced without disqualifying the beneficiary from eligibility for governmental benefits.  Expenditures are typically made for items and services not paid for by governmental assistance - items over and above the necessities of life.  The Court reviews the terms of the trust to assure it is within the statutory guidelines, approves the selected trustee, and supervises the trustee's administration of the trust.

Additional information