There are two general categories of trusts that Guardian serves:

1) Special Needs Trusts

Special Needs Trusts (SNT) are a unique tool designed to improve the quality of life for persons living with a disability. Persons who meet the eligibility requirements are able to deposit assets into the trust and still qualify for means tested public benefits, such as Medicaid and SSI. There are several different types of Special Needs Trusts and different and regulations that govern their use. 

To be qualified, an SNT must meet the requirements of both the Social Security Administration (SSA) and the Michigan Medicaid Program. Trusts are regularly reviewed by these organizations when they are first established on behalf of the beneficiary, and again each time benefit re-determinations are performed.

SNTs are set up to assist only the beneficiary, and funds expended must only accrue to that individual’s benefit. Funds cannot be used to the benefit of others, such as family members.

Once established and funded, an SNT is irrevocable and cannot be changed. The trust is only terminated when all funds have been expended or the beneficiary dies. Any funds remaining after the death of the beneficiary are distributed per the provisions of the SNT document. This process differs depending upon the type of SNT.

A trustee has the responsibility to manage, invest, and disburse funds on behalf of the beneficiary. The trustee is responsible for acting prudently, in accordance with the provisions of the trust, and in the best interest of the beneficiary.

There are limits to how trust funds may be spent to best preserve the beneficiary’s public benefits. While the rules are complex, the most general guideline is that trust funds should not be used to pay for goods or services provided for by other public benefits. Several examples of trust distributions that could negatively affect benefits are:

• Cash to the beneficiary that would be considered as income

• Food, rent, or utility payments, all of which would be considered as “in-kind support and maintenance”

• Gift cards that could be converted to cash, which would be considered as income

With the limits above noted, there are many goods and services constituting permissible trust distributions. These distributions improve the beneficiary’s quality of life and include:

• Attorney and professional services

• Caregiver expenses not covered by Medicaid

• Computer equipment and internet services

• Education expenses

• Eyeglasses, hearing aids, and prosthetic devices

• Home appliances, furniture, and improvements

• Medical and dental services not covered by insurance and/or Medicaid

• Prepaid funeral expenses

• Television and telephone services

• Transportation expenses, including vehicle, insurance, gasoline, and repairs

• Vacation and travel expenses for the beneficiary only, no companions

2) Grantor, Living, and Other Discretionary Trusts

There are variations of these types of trusts, which are a commonly used as a family estate planning tool. 

• For large estates, a bank or trust company may manage these trusts.

• For trusts that are under the minimums that these institutions require, a family member may serve as the Trustee. In cases where there is no family member that is willing or able to serve, or the situation calls for an impartial third party, Guardian can be a compassionate and cost-effective alternative. 

• For trusts requiring an individual trustee, the Guardian CEO serves as the appointed individual. By separate agreement, the organization provides all support services.

Because of the unique nature of each of these trusts, please set up an appointment to begin the conversation so we can address your needs.