You asked whether the spousal support payments being deposited into the trust are
countable income for Sylvia R~ for Supplemental Security Income (SSI) purposes. We
conclude that the spousal monthly payments are legally assignable to the trust, and
that the assignment is irrevocable, so that the payments should not be considered
income to Ms. R~, if the trust is not a resource. If the trust is a resource, the
payments are income. Whether amounts held in trust are a resource depends on the Agency's
policy interpretation of the Medicaid payback trust exceptions to counting trusts
as resources under the statute.
Sylvia R~ is disabled and receives SSI. On June 26, 2003, the Circuit Court of Outagamie
County, Wisconsin, entered an Order modifying a judgment of divorce and supplemental
judgment between Ms. R~ and Donald R~ which incorporated the parties' Stipulation
dated April 30 and May 7, 2003. Stipulation and Order (Stipulation). The Stipulation
set forth the distribution of $186, 462.62, the net sale proceeds from jointly held
real estate. The Stipulation provides that each party is entitled to one-half of the
net sale proceeds (Stipulation and Order, 1). The Stipulation further provided that
a number of items would be deducted from Mr. R~'s half of the net proceeds, including
$30,000 to be placed in an account of Mr. R~'s choosing from which monthly payments
would be made to the trust account of Ms. R~ (Stipulation and Order, s 2.b, 5).
On June 26, 2003, the same date that the court entered the Stipulation and Order,
Ms. R~'s attorney filed a Petition to Establish Trust and for Approval of transfer
of Funds to Trust (Petition to Establish Trust and For Approval of Transfer of Funds
to Trust (Petition)). Ms. R~'s attorney stated that Ms. R~ was entitled to receive
funds from assets to be distributed from proceeds from the sale of investments and
monthly payments from Mr. R~ in the amounts set forth in the Stipulation and Order;
that she was permanently disabled, but that she had needs that were not provided for
under public benefits; that it would be in Ms. R~'s best interest to have the funds
and proceeds used for her care under a Special Needs Trust, as provided for under
§ 42 U.S.C. 1396p(d)(4) and §49.454(4), Wis. Stats. (Petition, 3-7)). On the same
date, June 26, 2003, the Court ordered the establishment of the Sylvia A. R~ Irrevocable
Special Needs Trust attached as Exhibit B and the transfer of funds to the trust as
set forth in Exhibit A, including Ms. R~'s half share of the net sale proceeds. Order
to Establish Trust and for Approval of Transfer of Funds to Trust (Order) ; see also Exhibits A and B.
The Stipulation and Order
The Stipulation provides that each party is entitled to one-half of $186, 462.62,
the net sale proceeds of jointly-held real estate (Stipulation and Order, 1). The
Stipulation provides that a number of items would be deducted from Mr. R~'s half of
the net proceeds, including $30,000, which he was directed to place in an account
out of which monthly payments would be made into a trust account established by Ms.
R~. (Stipulation and Order, 2. a; 5). The Stipulation required that Mr. R~ place $30,000
into an account of his own choosing; that the account established by Mr. R~ make monthly
payments into a trust account to be established by Ms. R~; that in no event shall
any payments be made directly to Ms. R~; that the payments be in the amount of $419
per month for five years from May 2003 through April 2008; that at the end of five
years, beginning in May 2008, Mr. R~'s account must pay the sum of $219 per month
to Ms. R~'s trust account for as long as there are funds in Mr. R~'s account (Stipulation
and Order, 5). The Stipulation further provided that if the funds ran out before Ms.
R~'s death, she would have no entitlement to further payments form Mr. R~ under any
circumstances; that jurisdiction as to maintenance to Ms. R~ shall terminated at that
time; and Ms. R~ shall not be entitled for any further maintenance payments from Mr.
R~. (Stipulation and Order, 5). If Ms. R~ died while funds remained in the account,
such funds reverted to Mr. R~ (Id.). Finally, the Stipulation provided that once Mr. R~ funded the account with the
$30,000, so long as the account was fully insured, his maintenance obligation to Ms.
R~ was terminated. (Id.).
Sylvia A. R~ Irrevocable Special Needs Trust
Pursuant to the Petition of Ms. R~'s attorney, the court created a trust for the benefit
of Ms. R~ called the SYLVIA A. R~ IRREVOCABLE SPECIAL NEEDS TRUST dated June 25, 2002.
The trust states that it will be funded with assets to be distributed to Ms. R~ as
set forth in Schedule A, such as her half of the net sale proceeds, and from other
assets owned by Ms. R~ and that the Trustee may, in her or his discretion accept additions
from any other source. (Trust, Art. I B). It states that it is governed by the laws
of the State of Wisconsin (Trust, Art. III A) and that it is establish in accordance
with 42 U.S.C. § 1396p(d)(4)(A) and § 49.454(4), Wis. Stats. (Trust, Art. III, B).
The trust, therefore, purports to be a Medicaid payback trust pursuant to 42 U.S.C.
§ 136p(d)(4)(A). The trust is established for the benefit of Ms. R~ who has serious
and permanent disabilities (Trust, Art. II, A). Its "primary" purpose is to give Ms.
R~ the opportunity to enjoy the most pleasant, comfortable and happy life as is possible.
(Id.). The trust also states that because trust assets are not sufficient to ensure adequate
and appropriate care for Ms. R~ throughout her lifetime, another purpose of the trust,
therefore, " is to provide funds to supplement the essential, primary support, services
and medical care provided by public assistance in order to ensure [Ms. R~'s] care,
comfort and happiness, not to replace essential, primary support, services and medical
care provided by public assistance to which [Ms. R~] may be entitled" (Trust, Art.
The trust states that the trustee may use trust income and principal for Ms. R~'s
benefit at such times and in such amounts as the Trustee, in her or his sole and absolute
discretion, determines are consistent with the purposes of the trust (Trust, Art.
IV, A). The trustee may investigate any and all public sources of support, services
or benefits available to Ms. R~ and must consider the effect of any distribution to
or for Ms. R~'s benefit on her eligibility for such support, services or benefits
(Trust, Art. IV, B). The trust includes a non-exclusive list of expenses or costs
for which the trustee may make distributions, most involving the purchase of goods
and services (Trust, Art. IV C).
The Trustee has the authority, if the trustee deems it advisable, to initiate or pay
the expenses of another party to initiate an action to enforce Ms. R~'s right to public
assistance should such public assistance be denied, suspended, reduced or terminated
for any reason whatsoever (Trust, Art. IV D). The trustee my employ legal counsel
or pay the expenses of legal counsel employed by another party to determine Ms. R~'s
eligibility for any public assistance or the effect of any distribution or other action
on public assistance Ms. R~ receives or is entitled to receive (Id.). The trustee has no duty to preserve principal if she or he considers its current
use in Ms. R~'s best interest; Ms. R~'s care, comfort, and happiness shall be the
sole consideration in the trustee's exercise of discretion to make or withhold distributions;
the trustee shall have no liability for any good faith exercise of her or his power
to make or withhold distributions of income or principal; the trustee may consider
other resources available to Ms. R~, including her eligibility for public assistance
(Trust, Art. IV, E). The trust states that at no time shall Ms. R~ obtain a vested
interest in Trust income or principal, that the trustee may terminate all distributions
of income and principal to or for the benefit of Ms. R~ if the trustee considers it
likely that such continued distributions will result in a reduction of public assistance
to her; and that at all times the trust is meant to be interpreted to come within
the provisions of Wisconsin Statute 701.06(5m), which exempts the trust assets from
the claims of the State of Wisconsin or its agencies (Trust, Art. IV, G). The trust
further provides that distribution of the income and principal of the trust is solely
in the trustee's discretion and is not subject to any order of any court under sec.
701.13, Wis. Stats., or any other statute or legal or equitable doctrine (Trust, Art.
IV, G). It also states that the trustee "may be arbitrary and unreasonable in exercising
her or his discretion" (Id.).
The trust states that it is irrevocable; that it can be amended only in a manner consistent
with the purposes of the trust and "only by an appropriate Court upon petition of
the Trustee, for any reasons sufficient to the Court, including changes in the law
relating to public assistance" (Trust, Art. VIII s A, B). It also provides that the
trustee is authorized, with or without court approval, to make administrative or ministerial
modifications to the provisions of the trust for the purpose of conforming to law
or factual and economic circumstances (Trust, Art. VIII, C(3); Art. IX, T).
The trust provides that after the death of the beneficiary of the trust, Ms. R~, distribution
after payment of trust fees and expenses, the trustee "shall, to the extent required
by law, distribute such assets of the trust as shall be required to reimburse the
State of Wisconsin for the medical assistance benefits paid on behalf of [Ms. R~]
which, if not reimbursable by the terms of this Trust, would cause assets held by
this Trust to disqualify [Ms. R~] for benefits during her lifetime" (Trust Art. V,
A(1)). After these payments, the trustee may in his or her discretion, pay Ms. R~'s
funeral, burial and related expenses, (Trust V, A(2)); and pay, indirectly or directly,
income, gift, death, inheritance or estate taxes (Trust, V, A(3)). If any assets remain
after these payments, Trustee shall distribute such assets to Ms. R~'s heirs-at-law,
in equal shares, or to their issue per tirpes, pursuant to the intestacy provisions
of Wisconsin statutes then in effect (Trust, Art. V A(4)).
1. Monthly Payments Made to Trust Are Not Income to Ms. R~, unless the Trust is a
Wisconsin law expressly gives family courts the discretion to order spousal maintenance
payments to be placed in trust. Wis. Stat. Ann. §767.31 (West 2003); see also In re Paternity of Tucker M.O., 544 N.W.2d 417, 421 (Wis. 1996) (court properly ordered support payments to be
placed in trust fund). Wisconsin law states that:
The court may appoint a trustee, when deemed expedient, to receive any payments ordered,
to invest and pay over the income for the maintenance of the spouse entitled thereto
. . . or to pay over the principal sum in such proportions and at such times as the
Wis. Stat. Ann. § 767.31 (West 2003). Here, the court ordered the trustee to receive
assets, including additions from any source which would appear to include the monthly
payments to the trust. Upon the petition of Ms. R~'s attorney, the court appointed
a trustee to receive the transfer of assets listed as well as to receive other assets
owned by Ms. R~, and to receive, in the trustee's discretion, additions from any other
source. See Order; Trust, I(B); see also Petition, 3 (stating that Ms. R~ is entitled to receive funds from the sale of investments
and monthly payments from Mr. R~ as set forth in the Stipulation). The court appointed
a trustee to receive "any payments ordered" which appear to include the monthly payments
from Mr. R~ to the trust. Even though the trustee is not required to pay over the
monthly payments for the maintenance of Ms. R~, the monthly payments to the trust,
appear to be proper under Wisconsin law._/1 The Supreme Court of Wisconsin seems open
to settlement terms that modify statutory provisions, at least where the statute does
not prohibit such deviations. See Nichols v. Nichols, 469 N.W.2d 619, 623 (Wis. 1991).
However, while Wisconsin law permits a court to order a trustee to receive any payments
ordered, including spousal support payments, they may still constitute unearned income
to the spouse who receives the payments. Under both Wisconsin and federal law, spousal
maintenance payments ordinarily constitute unearned income attributable to the spouse
who receives the payments. 20 C.F.R. § 416.1121(b); Wis. Stat. Ann. §§71.03(1), 71.52(6)
(West 2003); POMS SI 00830.418. A legally assignable payment that is assigned to a trust, however, is not considered
income for SSI purposes, but only if the assignment is irrevocable. See POMS SI 01120.200(G)(d). If the assignment is revocable, the payment is income to the individual legally
entitled to receive it. Id.
Here, the monthly payments are deposited into the trust from an account established
by Mr. R~ over which Ms. R~ has no control. See Stipulation; Trust. While Ms. R~'s attorney petitioned the Court to establish the
trust, she cannot control any disbursements from the trust income or principal (Trust,
s IV(A), (G)). Nor is there any language in either the Stipulation or the Trust state
indicating that the monthly payments to Ms. R~ shall continue "until further order
of the Court." Rather, under the terms of the trust, only the trustee can petition
the court to modify the trust (Trust, VIII(B)).
The parties, then, agreed to non-modifiable monthly payment amounts and a non-modifiable
termination of the payment amounts: Mr. R~ was to establish an account of his own
choosing, fund it with $30,000 out of his share of the net sale proceeds; pay a non-modifiable
monthly amount of $419 into Ms. R~'s trust for a non-modifiable term of five years
from May 2003 through April 2008; and thereafter, a non-modifiable amount of $219
until the funds in the account ran out or until Ms. R~ died. In the former case, Ms.
R~ agreed that she would be entitled to no further maintenance; in the latter, she
agreed that any remaining funds would revert to Mr. R~. Moreover, the parties agreed
that the payments were to be made to the trust account and that "(i)n no event shall
any payments be made directly to" Ms. R~ (Stipulation, 5). Thus, it appears that the
parties intended that Ms. R~ could not ask to modify the agreement to revoke the transfer
to the trust and receive the maintenance payments herself.
These provisions are more restrictive than Wisconsin law, which provides that after
any judgment of divorce providing for maintenance or creating a trust, the Court retains
the discretion to hear motions from either party to revise or modify the order with
respect to the amount or payment of maintenance, "and may make any judgment or order
respecting any of the matters that such court might have made in the original action."
Wis. Stat. Ann. § 767.32 (West 2003). However, a court can modify the amount of maintenance
or the time period over which it must be paid only if there is a substantial change
in circumstances. See Wis. Stat. Ann. § 767.32(1)(a); Whitford v. Whitford, 232 Wis.2d, 38, 41; 606 N.W.2d 563, 567 (Wis. 1999); Nichols v. Nichols, 469 N.W.2d 619, 622 (Wis. 1991).
Moreover, under Wisconsin law, parties may establish non-modifiable settlement terms,
and, in certain circumstances, the parties may be estopped from requesting modification
of these terms, notwithstanding general statutory provisions of Wisconsin Statute
§767.32, which generally allows for modifications. Nichols, 162 Wis. 2d at 105, 469 N.W.2d at 622; Whitford v. Whitford, 232 Wis. 2d 38, 44-45, 606 N.W.2d 563, 568 (Wis. Ct. App. 1999). Estoppel applies
when (1) both parties entered a stipulation to the agreement freely and knowingly;
(2) the overall settlement is fair and equitable; (3) the settlement, including the
maintenance agreement, is not against public policy; and (4) the non-modifiable term
must be one that the court could not have ordered without the parties' agreement.
The case law also indicates that because the parties are giving up the statutory right
to modification, their agreement must be clear and unequivocal. Id., 232 Wis.2d at 44, 606 N.W.2d at 568.
Here, the stipulation meets this four-part test. The non-modifiable terms in the stipulation
could not have been ordered by the court without the parties' agreement. There is
no suggestion that both parties did not enter the stipulation freely and knowingly.
The overall settlement was not against public policy. See Nichols, 162 Wis.2d 96, 106-07 (holding that a provision in a divorce judgment providing
that the amount of maintenance cannot be modified does not violate public policy).
The stipulation was fair and equitable. In agreeing to non-modifiable monthly payments
only to the trust, it appears that the parties agreed on this amount of maintenance
and the payment only to the trust based on the assumption that the trust would allow
Ms. R~ to continue receiving public benefits, including SSI. In addition, both parties
gained other benefits: Mr. R~ agreed to reduce his half of the net proceeds from the
sale of jointly held real estate by, among other things, paying off the mortgage debt,
in exchange for a fixed maintenance obligation; Ms. R~ gave up the option to modify
the monthly payments in exchange for receiving her half of the net proceeds and for
continuing eligibility for SSI. See N~, 162 Wis.2d 96, 108-115, 469 N.W.2d 619, 624-27; Whitford, 232 N. Wisc.2d 38, 49-51, 606 N.W. 2d 563, 570-72 (Wisc. 1999). It therefore appears
that the conditions of estoppel apply here to preclude Ms. R~ from seeking modification
of these non-modifiable terms. Thus, the assignment of the monthly payments to the
trust is irrevocable and should not be considered income to Ms. R~, if the trust is
not a resource. However, if the trust is a resource, the payments would be income.
2. Assets Held in the Trust May or May Not Be Resources to Ms. R~
We next address whether the trust assets, including the payments actually made to
and held in the trust, should be considered a resource to Ms. R~. Under the Social
Security Act, trusts created on or after January1, 2000, from the assets of an SSI
claimant or beneficiary will be considered a resource to the extent that the trust
is revocable or to the extent that any payments can be made from the trust for the
benefit of the individual. See 42 U.S.C. § 1382b(e); POMS SI 01120.201. This rule applies unless the trust satisfies the statutory requirements of a Medicaid
payback trust. See 42 U.S.C. §1382b(e)(5); POMS SI 01120.203. When the statutory trust provisions do not apply, regular resource rules still apply.
POMS SI 01120.200; POMS SI 01120.203(B)(1). Under the regular resource provisions, a trust is a resource if it is unilaterally
revocable, if the SSI beneficiary can direct the trustee to provide for her support
and maintenance, or if the SSI beneficiary can sell her beneficial interest in the
trust. POMS SI 01120.200(D)(1).
The trust was established with Ms. R~'s assets, including the her share of the proceeds
of the net sale of investment property. The trust was created after January 1, 2000,
and the trustee has discretion to expend all of the trust assets for Ms. R~'s benefit.
Thus, the trust will be a resource under the statute, unless the Medicaid payback
trust exception applies. It appears that the Medicaid payback exception may apply
to counting the trust under the statute, depending on how the Agency interprets that
provision. If the Agency determines that the exception applies to counting the trust
as a resource under the statute, the trust would not be a resource under regular resource
a. The Medicaid Payback Exception May Apply to Counting the Trust as a Resource Under
The Medicaid payback exception to counting the trust as a resource under the statute
applies where the trust is (1) established with the assets of an individual under
the age of 65 who is disabled; (2) established for the benefit of such individual
by a parent, grandparent, legal guardian or a court; and (3) provides that, on the
death of the individual, any funds remaining in the trust will be used to reimburse
the appropriate state for Medicaid payments made for the benefit of the individual
during her lifetime. See 42 U.S.C. § 1396p(d)(4)(A); POMS SI 01120.203(B)(1).
Here, the first and third requirements are met. Ms. R~ is under age 65 and is disabled.
And, the trust provides that, upon Ms. R~'s death, any remaining funds would first
be used to reimburse that state of Medicaid payments made for her benefit during her
The second requirement, however, may be problematic. The court established the trust,
but it did so at the request of Ms. R~'s attorney, and presumably could not have done
so without her consent. The Office of the General Counsel previously has advised that
the Medicaid payback exception in 42 U.S.C. § 1396p(d)(4)(A), is best interpreted
to require that the trust be established by parents, grandparents, legal guardians
and courts for disabled children and disabled incompetent adults, or by a court where
the individual is not exercising any discretion in the creation of the trust. See Memorandum from Associate General Counsel for Program Law to Acting Associate Comm.
for Program Benefits, Questions Related to Implementation of Section 205 of the Foster Care Independence
Act of 1999, Pub. L. No. 106169 (Feb. 7, 2002). If the Agency were to adopt a policy based on this interpretation
of the statute, the trust in this case would not be "established by" the court for
purposes of 42 U.S.C. § 1396p(d)(4)(A), and therefore would not qualify for the Medicaid
payback trust exception to counting the trust as a resource under the statute. It
would be counted as a resource under 42 U.S.C. § 1382b(e) and POMS 01120.201.
However, if the Agency considers this trust, as a matter of Agency policy, to be established
by the court under these circumstances, the trust would otherwise qualify for the
Medicaid payback trust exception to counting the trust as a resource under 42 U.S.C.
§1382b(e). If the Agency determines that the exception applies to counting the trust
under the statute, the regular resource rules would apply to determine whether the
trust is a resource. See POMS SI 1120.200; POMS SI 01120.203(B)(1).
b. The Trust Is Not a Resource Under the Regular Resource Rules.
Under regular resource rules, assets are a resource for SSI purposes if the individual
owns them and can convert them to cash to be used for his support and maintenance.
20 C.F.R. § 416.1201(a). If the individual has the right, authority, or power to liquidate
the property, it is considered a resource. Id. at (1). Thus, trust assets are a resource to an individual if she can revoke the
trust and use the assets to meet her individual needs for food, clothing, and shelter;
if the individual can direct the use of the trust assets for her support and maintenance
under the terms of the trust; or if the individual can sell her beneficial interest
in the trust. See POMS SI 01120.200(D)(1).
Whether the claimant can revoke or terminate the trust or direct use of the assets
depends upon the terms of the trust agreement and applicable state law. See POMS SI 01120.200(D)(2). Wisconsin Law provides that, after a judgment providing for maintenance, the
court may, at any time, on petition of either party, revise and alter the judgment
"respecting the appropriation of a payment of the principal and income of the property
so held in trust, and may make any judgment or order respecting any of the matters
that such court might have made in the original judgment . . . ." Wis. Stat. Ann.
§ 767.32(1)(a) (West 2003). This statute requires a showing of a change in circumstance
in order to make revisions or modifications to the amount of or length of time for
paying maintenance, but we found no such limitation on changing the entity to whom
the payments would be made. Wis. Stat. Ann. § 767.32(1)(a); Whitford v. Whitford, 232 Wis.2d, 38; 606 N.W.2d 563 (Wis. 1999); Nichols v. Nichols, 469 N.W.2d 619 (Wis. 1991). Thus, under the statute, it would appear that Ms. R~
could ask the court at any time to amend or revise the trust to pay income or principal
for her support and maintenance.
As explained above, however, the Supreme Court of Wisconsin has recognized that parties
may establish non-modifiable settlement terms, and that, in such circumstances, the
parties may be estopped from requesting modification of these terms, notwithstanding
general statutory provisions of Wisconsin Statute §767.32, which generally allows
for modifications. Nichols, 162 Wis. 2d at 105, 469 N.W.2d at 622; Whitford v. Whitford, 232 Wis. 2d 38, 44-45, 606 N.W.2d 563, 568 (Wis. Ct. App. 1999). As discussed, we
believe that estoppel applies here to prevent Ms. R~ from asking for any modification
in the monthly payments. For the same reasons, we also believe that under these circumstances,
a court would conclude that Ms. R~ intended the terms of the trust to be non-modifiable,
so that funds from any of the assets held in the trust could not be paid, even on
order of the court, except in the trustee's discretion. The trust itself states that
"Distribution of the income and principal of this Trust is solely in the Trustee's
discretion and is not subject to any order of any court under Section 701.13, Stats.,
or any other statute or legal or equitable doctrine." (Trust Art. IV, G). We conclude
that a court would most likely conclude that the provisions are sufficiently clear
and unequivocal to establish a non-modifiable provision regarding the appropriation
and payment of the principal and income of the property held in trust pursuant to
the divorce decree.
As discussed, the other elements of estoppel appear to exist, as well. Both parties
appear to have entered the agreement freely and knowingly; the overall settlement
seems fair and equitable; the settlement, including the provision in question, do
not seem patently against public policy, since both state and federal law allow these
types of trusts for indigent disabled individuals; and the non-modifiable terms are
ones that the court could not have ordered without the parties' agreement.
We note that, even if Ms. R~ could not ask the court to revise the trust under Section
767.32, she still could revoke the trust if she were the grantor and sole beneficiary
of the trust. See Wis. Stat. Ann. §701.12(1) (West 2003) (absent express language providing a right
of revocation, modification, or termination, a trust cannot be revoked or modified
unless the grantor or settlor and all of the beneficiaries agree). Here, however,
Ms. R~ could not revoke the trust unilaterally because the trust names other contingent
beneficiaries of the trust, including Ms. R~'s heirs, whose consent would be necessary
to revoke the trust. See Wis. Stat. Ann. § 854.22 (West 2003) (designation of "heirs" generally assumed to
create a beneficial interest in those that would inherit).
Furthermore, the trust would not otherwise be a resource under the regular resource
rules because Ms. R~ cannot direct the trustee to make payments for her support and
maintenance, and presumably could not sell her beneficial interest in the discretionary
trust for her benefit. See POMS SI 01120.200(D)(1)(a); (Trust Art. II G); Restatement (Third) of Trusts, §60, comment f (2003).
Finally, we note that, even if the trust is not a resource, any distributions made
directly to Ms. R~ or paid for her support and maintenance, will be income to her.
See 20 C.F.R. §416.1102; POMS SI 01120.200(E)(1)(a)-(b). Similarly, if the trustee terminates the trust, due to insubstantial
assets, and pays Ms. R~ any remaining funds after reimbursing the State for medical
assistance, any assets she receives would be income to her. (Trust Art. I, C(2)).
In summary, we conclude that Wisconsin law permits Mr. R~ to make spousal support
payments into trust. Under Wisconsin law, and by agreement of the parties, Ms. R~
has irrevocably assigned the monthly payments to the trust and the payments should
not be considered income, if the trust is not a resource. It it is a resource, the
payments are income regardless of the assignment.
The assets in the trust, including any maintenance payments actually assigned to and
held in the trust, may be resources, depending on whether the Agency adopts the position
that the trust cannot be considered to be established by the court where the SSI claimant
is a competent adult and requested that the court establish the trust. If the Agency
determines that, under such circumstances, the trust was established by the individual,
rather than the court, then the trust would be a resource under the statutory provisions
because it would not meet the Medicaid payback exception to counting the trust. If,
however, the Agency decides that, under these facts, the trust is considered to be
established by the court, the trust otherwise meets the requirements for the Medicaid
payback exception to counting it under the statute. The trust also would not be a
resource under the regular resource rules. The trust is irrevocable; Ms. R~ cannot
compel the trustee to pay for her support and maintenance; and she cannot sell her
beneficial interest in the trust. However, any payments from the trust to Ms. R~ or
for her support and maintenance would be income to her.
_/1 It should be noted that none of the documents provided to us specifically designate
the monthly payments from Mr. R~'s account into the trust as maintenance payments
nor require that they be used for her maintenance. See Stipulation, Petition, Order, and Trust. Nor does the Stipulation recognize that
the payments be included as income on Ms. R~'s income tax returns. Nevertheless, the
Stipulation states that Mr. R~'s obligation with respect to maintenance ends once
he deposits the $30,000 into an account established by him, as long as it is properly
insured account, and that the court's jurisdiction with respect to maintenance to
Ms. R~ shall terminate when the funds run out. Stipulation, 5. Thus, while the pertinent
documents do not specifically designate the monthly payments as maintenance payments,
the Stipulation contains language indicating that the payments are related to the
maintenance obligations of Mr. R~ and the right of Ms. R~ to receive maintenance.