Our last article gave an overview of Third-Party Special Needs Trusts, but Trusts are not one size fits all. We now turn to another option to provide benefits for special needs beneficiaries: Pooled Special Needs Trusts.
Pooled Special Needs Trusts are a great tool for families that want to provide care for a special needs beneficiary but they may not have large funds that would support a lifetime third-party trust. Organizations like The Georgia Community Trust and The Arc manage large pooled accounts that generally have no minimum contribution amounts. The organizations manage the pooled accounts and make distributions from the sub-accounts created for each beneficiary.
While the Pooled Trusts are managed by organizations, a joinder agreement can name a Co-trustee for the trust so that a family member, friend, or trusted advisor can request funds on behalf of the beneficiary and submit expenditure receipts.
A joinder agreement can also dictate where any remaining funds go after the death of a beneficiary. If the Pooled Trust was funded from the beneficiaries’ own money (an inheritance, settlement, etc.), Medicaid must be paid back first.
Pooled Trusts are a great tool for those who need to keep management and administrative costs down, who may not have a great deal of money to contribute to a Special Needs Trust, who cannot find a suitable Trustee for a Special Needs Trust, or for a beneficiary who is over 65 but needs to create a Self-Settled Special Needs Trust. Our next article will discuss Self-Settled Special Needs Trusts.
Call Grissom Law, LLC at 678-781-9230, we have the skills, experience, and expertise to assist you in preparing your plan and in determining if a Pooled Special Needs Trust should be a part of the plan.
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