This includes trusts established before January 01, 2000, that contain assets of the individual, any of which were transferred before January 01, 2000.

If the trust was established prior to January 01, 2000, but no assets of the individual were transferred to the trust prior to January 01, 2000, see SI 01120.201.

This includes trusts that are:

• •

  established before January 01, 2000, that contain assets of third parties;

• •

  established on or after January 01, 2000, that contain only assets of third parties, or the portion of a commingled trust attributable to assets of third parties; and

• •

  Indian Gaming Regulatory Act (IGRA) trusts established by the Indian tribes that meet the criteria in SI 01120.195F.

Trusts established on or after January 01, 2000, to which the instructions in SI 01120.201 through SI 01120.204 do not apply. For example, section 1613(e) carves out certain exceptions, noting it does not apply to trusts described in section 1917(d)(4)(A) or (C), commonly referred to as special needs and pooled trusts, respectively. When it is determined that a special needs trust or a pooled trust exception is met, the trust must still be evaluated here under the rules of SI 01120.200.

A conservatorship account generally is established by a court and administered by a court-appointed conservator for the benefit of an individual. A conservatorship account differs from a trust in that the “beneficiary” of the conservatorship account retains legal ownership of all the account assets, although in some cases the assets may not be available for support and maintenance. For instructions pertaining to conservatorship accounts, see SI 01140.215.

Many nursing homes, institutions, and government social services agencies maintain so-called “patient trust accounts” for individuals to provide them with toiletries, candy, and sundries. Although titled as trust accounts, they are not. For example, the individual might legally own the money in the account, while a social services agency holds the money for the individual and disburses it as necessary for the individual’s benefit. For more information on transactions involving agents, see:

• •

  GN 00603.020 Collective Savings and Checking Accounts

• •

  SI 00810.120 Income Determinations Involving Agents

• •

  SI 01120.020 Transactions Involving Agents

An ABLE account is a type of tax-advantaged account that an eligible individual can use to save funds for their disability-related expenses. The eligible individual, who is also the designated beneficiary of the ABLE account, must be blind or disabled by a condition that began before the individual’s 26th birthday. A State (or a State agency or an instrumentality of a State) can establish an ABLE program. An eligible individual can open an ABLE account through the ABLE program in any State, if the State permits it. ABLE accounts are not trusts, and you should not evaluate them under trust instructions. For more information on ABLE accounts, see SI 01130.740.

One of the most common types of “in trust for” accounts is the representative payee account. A representative payee account is not a trust. However, its title may misleadingly suggest that the representative payee is the legal owner of the account principal. If a representative payee deposits current or conserved benefits in an account, the titling of the account should reflect the beneficiary's ownership interest in the account. For instructions pertaining to transactions or determinations involving agents, see SI 01120.020 and SI 00810.120. For instructions pertaining to the titling of accounts established by representative payees, see GN 00603.010.

A Totten trust is a revocable trust created by the depositing of money, usually in a savings account at a bank, in the depositor’s name as trustee for another. (It may have the phrase “in trust for” in the title.) The typical Totten trust is a kind of “pay on death” account. That is, the depositor names a beneficiary who inherits the funds in the account upon the depositor’s death.

Trust principal is a resource for SSI purposes if a trust beneficiary (applicant, recipient, or deemor) has legal authority to revoke or terminate the trust and then use the funds to meet their food or shelter needs. For the definitions of revoke and terminate, see SI 01120.200B.11. and SI 01120.200B.14. in this section. The trust principal is also a resource for SSI purposes if the trust beneficiary can direct the use of the trust principal for their support and maintenance under the terms of the trust.

Additionally, if the trust beneficiary can sell their right to receive payments from the trust, that right is a resource. For example, if the trust provides for payment of $100 per month to the trust beneficiary for spending money, and the trust does not have a valid spendthrift clause, then the trust beneficiary may be able to sell the right to future payments for a lump-sum settlement. The present value of the future payments counts as a resource. For more information on spendthrift clauses, see SI 01120.200B.13. in this section.

1. 1. 

   Grantor

   In some cases, the grantor has the authority to revoke a trust. Even if the grantor does not specifically retain the power to revoke a trust, a trust may be revocable in certain situations. For information on grantor trusts, see SI 01120.200B.4. and SI 01120.200D.3. in this section.

   Additionally, State law may contain presumptions as to the revocability of trusts. If the trust principal reverts to the grantor upon revocation and they can use it for support and maintenance, then the principal is a resource to the grantor.

2. 2. 

   Trust beneficiary

   A trust beneficiary generally does not have the power to terminate a trust. However, in some instances, the trust beneficiary may have the authority to terminate the trust and gain access to the trust assets or direct the use of the trust principal. Specific trust provisions may allow the trust beneficiary to act on their own or to order actions by the trustee. The trust beneficiary's ability to direct the use of the trust principal for support and maintenance, together with their equitable ownership in the trust principal, makes the trust principal a resource to the trust beneficiary.

   The trust beneficiary's right to mandatory periodic payments may be a resource equal to the present value of the anticipated payments, unless a valid spendthrift clause or other provision prohibits transfer or sale of the beneficiary’s interest in such anticipated payments. For more information on spendthrift clauses, see SI 01120.200B.13. in this section.

   NOTE: 

   While a trustee may have discretion to use the trust principal for the benefit of the trust beneficiary, the trustee is a third party and not an agent of the trust beneficiary. The actions of the trustee generally are not considered to be the actions of the trust beneficiary, unless the trust specifically states otherwise.

3. 3. 

   Trustee

   Occasionally, a trustee may have the legal authority to terminate a trust. However, the trust generally is not a resource to the trustee unless they become the owner of the trust principal upon termination. The trustee is a third party. Although the trustee has access to the trust principal for the benefit of the trust beneficiary, this does not mean that the trust principal is the trustee's resource. If the trustee has the legal authority to withdraw the trust principal and use it for their own support and maintenance, the amount of the trust principal that they can withdraw and use is the trustee's resource for SSI purposes.

   NOTE: 

   We are not responsible for developing or reporting claims or allegations of trustee misuse of trust funds. We will get involved only if the individual or entity allegedly misusing the funds is also the representative payee. For misuse of SSI funds, see GN 00604.001.

4. 4. 

   Totten trust

   The grantor of a Totten trust has the authority to revoke the financial account trust at any time. Therefore, the funds in the account are their resource.

Cash paid directly from the trust to the individual is unearned income. We treat disbursements from the trust to the trust beneficiary’s personal debit card the same as cash disbursements. We count the disbursement as unearned income for the month the disbursement is received or added to the debit card.

Disbursements from the trust to third parties that result in the trust beneficiary’s receiving non-cash items (other than food or shelter) are in-kind income if the items would not be partially or totally excluded non-liquid resources if retained into the month after the month of receipt. For example, if a trust buys a car for the trust beneficiary and the trust beneficiary's spouse already has an excluded car for SSI purposes, the disbursement to purchase the second car is income in the month of receipt since it would not be an excluded resource in the following month.

For receipt of certain noncash items, see SI 00815.550. For a list of resource exclusions, see SI 01110.210.

Food or shelter received by the trust beneficiary as a result of disbursements from the trust to a third party is income in the form of in-kind support and maintenance (ISM) and is valued under the presumed maximum value (PMV) rule. For instructions pertaining to the PMV rule, see SI 00835.300. For rules pertaining to a home, see SI 01120.200F in this section.

Generally, disbursements from the trust to a third party are not income to the trust beneficiary, unless otherwise stated in SI 01120.200E.1.a. and SI 01120.200E.1.b. in this section. Disbursements that do not count as income may include those made for educational expenses, therapy, transportation, professional fees, medical services not covered by Medicaid, phone bills, recreation, and entertainment. This list is illustrative and does not limit the types of distributions that a trust may permit. For bills paid by a third party, see SI 00815.400.

Disbursements made from the trust to a third party that result in the trust beneficiary’s receiving non-cash items (other than food or shelter) are not income if those items would become a totally or partially excluded non-liquid resource if retained into the month after the month of receipt. For example, if a trust purchases a computer for the trust beneficiary, the computer is not income, since we would exclude the computer from resources as a household good in the following month.

For resource treatment of household goods, personal effects, and other personal property, see SI 01130.430. For receipt of certain non-cash items, see SI 00815.550. For a list of resource exclusions, see SI 01110.210.

If a trust pays a credit card bill for the trust beneficiary, whether the individual receives income depends on the list of itemized charges on the bill. If the trust pays for food or shelter items on the bill, we will generally charge the individual with ISM for those items up to the PMV. If the bill includes non-food, non-shelter items, the individual does not receive income as a result of the payment, unless the items received would not be totally or partially excluded non-liquid resources the following month.

EXAMPLE: If the credit card bill includes restaurant charges, payment of those charges results in ISM. If the bill also includes the purchase of clothing, payment for the clothing is not income.

Administrator-managed prepaid cards, such as True Link cards, are a type of restricted debit card that can be customized to block the cardholder’s access to cash, specific merchants, or entire categories of spending. Typically, the trustee is the account owner and administrator, and the trust beneficiary is the cardholder. To evaluate the income and resource implications of trust disbursements to administrator-managed prepaid cards, we must determine who owns the prepaid card account.

If the trustee is the owner of the prepaid card account:

• •

  Whether the trust beneficiary receives income from trust disbursements depends on the type of purchase reflected in the card statement. Treat purchases in the following manner:

  • –

    If the administrator-managed prepaid card is used to obtain cash, such as at an ATM, the withdrawal counts as unearned income.

  • –

    If the administrator-managed prepaid card pays for food or shelter items, such as charges at a restaurant, the individual will generally be charged with ISM up to the PMV.

  • –

    If the administrator-managed prepaid card pays for non-food, non-shelter items, such as for clothing at a department store, the individual usually does not receive income unless the item received would not be a totally or partially excluded non-liquid resource the following month.

• •

  The administrator-managed prepaid card is not the trust beneficiary’s resource.

If the trust beneficiary is the owner of the prepaid card account:

• •

  Count all disbursements from the trust onto the card as unearned income; and

• •

  Count any unspent balance on the card as a resource as of the beginning of the month after funds are loaded onto the card.

Consider gift cards and gift certificates purchased by the trust for the individual’s use to be cash equivalents. If the individual can use a gift card or certificate to buy food or shelter (such as a restaurant, grocery store, or VISA gift card), it is unearned income in the month of receipt. Any unspent balance on the gift card or certificate is a resource beginning the month after the month of receipt. If the store does not sell food or shelter items (such as a flower shop or electronics store), but the card does not have a legally enforceable prohibition on the individual’s selling the card for cash, then it is still unearned income. For general policy on gift cards and gift certificates, see SI 00830.522.

Reimbursements made from the trust to a third party for funds expended on behalf of the trust beneficiary are not income.

Regular income and resource rules apply to items that a trust beneficiary receives from a third party. If a trust beneficiary receives a non-cash item (other than food or shelter), it is in-kind income if the item would not be a partially or totally excluded non-liquid resource if retained into the month after the month of receipt. If a trust beneficiary receives food or shelter, it is income in the form of ISM.

Funds transferred from the trust into an account established by the trust beneficiary under the Achieving a Better Life Experience (ABLE) Act are excluded from income to the trust beneficiary. For treatment of deposits into an ABLE account, see SI 01130.740.

If the trust principal is a resource to the individual, disbursements from the trust principal received by the individual or that result in receipt of something by the individual are not income but conversion of a resource. However, trust earnings may be income. For instructions pertaining to the conversion of resources from one form to another, see SI 01110.100. For treatment of income when the trust principal is a resource, see SI 01120.200G.2. in this section. For treatment of dividends and interest as income, see SI 00830.500.

If the trust is established with the assets of an individual or their spouse and the trust (or portion of the trust) is a resource to the individual:

• •

  any disbursement from the trust (or from the portion of the trust that is a resource) that is not made to, or for the benefit of, the individual is considered a transfer of resources as of the date of the payment and is not considered income to the individual (see SI 01150.110); and

• •

  any foreclosure of payment (an instance in which no disbursement can be made to the individual under any circumstances) is considered to be a transfer of resources as of the date of the foreclosure. Such foreclosure is not considered income to the individual.

If the trust, whose principal is not a resource, purchases the home outright and the trust beneficiary lives in the home in the month of purchase, the home is income in the form of ISM and reduces the trust beneficiary's payment no more than the PMV in the month of purchase only, regardless of the value of the home (see SI 01120.200E.1.b. in this section).

If the trust, whose principal is not a resource, purchases the home with a mortgage and the trust beneficiary lives in the home in the month of purchase, the home would be ISM in the month of purchase. Each of the subsequent monthly mortgage payments results in the receipt of income in the form of ISM to the trust beneficiary living in the house, each valued at no more than the PMV (see SI 01120.200E.1.b. in this section).

If the trust pays for other shelter or household operating expenses, these payments are income in the form of ISM in the month of the trust beneficiary’s use. For computations of ISM from outside the household, see SI 00835.350. For countable shelter expenses, see SI 00835.465D.

If the trust pays for repairs, maintenance, improvements, or renovations to the home, such as renovations to the bathroom to make it handicapped accessible, installation of a wheelchair ramp or assistive devices, or replacement of a roof, the trust beneficiary does not receive income. Disbursements from the trust for improvements increase the value of the resource and, unlike household operating expenses, do not provide ISM. For disbursements that are not income, see SI 01120.200E.1.c. in this section.

Trust earnings are not income to the trustee or grantor unless designated as belonging to the trustee or grantor under the terms of the trust; for example, as fees payable to the trustee or interest payable to the grantor.

Trust earnings are not income to the SSI applicant or recipient who is a trust beneficiary unless the trust directs, or the trustee makes, payments from the trust to the trust beneficiary.

Additions to trust principal made directly to the trust are not income to the grantor, trustee, or trust beneficiary. For exceptions to this rule, see SI 01120.200G.1.c. and SI 01120.200G.1.d. in this section. For clarification on the proper instructions to follow when additions are made by the individual or a third party, see SI 01120.200J. in this section.

Certain payments are non-assignable by law. Therefore, they are income to the individual entitled or eligible to receive the payments under regular SSI income rules, unless an exclusion applies (for example, SSI payments do not count as unearned income). Although a trust may be structured such that it appears that non-assignable payments are made directly into the trust, non-assignable payments may not be made directly into a trust, to avoid income counting or for any other reason.

Important examples of non-assignable payments include:

• •

  Temporary Assistance to Needy Families (TANF)/Aid to Families with Dependent Children (AFDC);

• •

  Railroad Retirement Board-administered pensions;

• •

  Veterans’ pensions and assistance;

• •

  Federal employee retirement payments (CSRS, FERS) administered by the Office of Personnel Management;

• •

  Social Security Title II and SSI payments; and

• •

  Private pensions under the Employee Retirement Income Security Act (ERISA) 29 U.S.C.A. § 1056(d)).

NOTE: Per GN 02402.060C, SSI and Title II payments generally may not be direct deposited into a trust. Since direct deposit into a trust transfers legal ownership and control of the funds to the trustee and not the Title II/SSI beneficiary/recipient, such an arrangement violates the assignment of benefits provision(s) of sections 207 and 1631(d)(1) of the Act.

A legally assignable payment that is assigned to a trust or trustee is income for SSI purposes, to the individual entitled or eligible to receive the payment, unless an SSI income exclusion applies or the assignment is irrevocable. We consider assignment of payment by court orders to be irrevocable. For example, child support or alimony payments paid directly to a trust or trustee because of a court order are considered irrevocably assigned and thus not income. Also, U.S. Military Survivor Benefit Plan (SBP) payments assigned to a special needs trust are not income because the assignment of an SPB annuity is irrevocable. For more information on SPB annuities, see SI 01120.201J.1.e.

For non-assignable payments, see SI 01120.200G.1.c. in this section.

Trust earnings are income to the individual for whom the trust principal is a resource, unless the terms of the trust make the earnings the property of another. For when to count income, see SI 00810.030.

Additions to principal may be income or conversion of a resource, depending on the source of the funds. If a third party deposits funds into the trust, the funds are income to the trust beneficiary. If the trust beneficiary transfers funds into the trust from an account that they own, the funds are not income but a converted resource.

Medicaid trusts are trusts that are established by an individual (by a means other than a will) on or after August 11, 1993, and that are made up, in whole or in part, of assets of that individual. We consider a trust as established by an individual if it was established by:

• •

  the individual;

• •

  the individual's spouse; or

• •

  a person (or a court or administrative body) with legal authority to act for the individual or spouse or who acts at the direction or request of the individual or spouse.

Medicaid trusts may contain terms such as “OBRA 1993 pay-back trust” or “trust established in accordance with 42 USC 1396” or may be mislabeled as an “MQT.” Medicaid trusts must be evaluated under SI 01120.201 to determine whether they are a resource for SSI purposes.

For additional information and procedures for coding and referring these trusts to the State Medicaid agencies, see SI 01730.048.

Medicaid trusts generally have a payback provision stating that, upon termination of the trust or the death of the beneficiary, the trust will reimburse the State Medicaid agency for medical assistance paid on behalf of the individual. According to the law in most States, the State is not the residual or contingent beneficiary but is a creditor, and we consider the reimbursement to be payment of a debt, unless the trust instrument reflects a clear intent that the State is a beneficiary rather than a creditor. This law may or may not apply in your State, so consult your regional instructions or regional office.

Obtain a copy of the trust document (the original trust document is not required) and any related documents and review the document(s) to determine whether the:

• •

  individual (applicant, recipient, or deemor) is the grantor, trustee, or trust beneficiary;

• •

  trust was established before, on, or after January 01, 2000;

• •

  trust was funded with assets of the individual or third parties or both;

• •

  trust is revocable or can be terminated and, if so, whether the individual has authority to revoke or terminate the trust and to use the principal for their own support and maintenance;

• •

  individual has access to the trust principal;

• •

  trust provides for or permits payments for the benefit of the individual, to the individual or on the individual’s behalf;

• •

  trust principal generates income (earnings) and, if so, whether the individual has the right to any of that income;

• •

  trust provides for mandatory periodic payments and, if so, whether the trust contains a spendthrift clause that is valid under State law and prohibits the voluntary and involuntary alienation of any interest of the trust beneficiary in the trust payments; and

• •

  trust is receiving payments from another source.

Depending on the trust’s date of establishment and whose funds the trust principal contains, follow these instructions to determine the resource status and income treatment of the trust:

*If the SSI recipient is the beneficiary of an unfunded third-party trust (e.g., the trust will be funded upon the death of a parent), it is not necessary to review and submit the unfunded trust to SSITMS for SSI eligibility purposes until it is funded.

Consult any regional instructions that pertain to trusts to see if there are State or Tribal laws to consider on such issues as revocability or irrevocability and grantor trusts. You may also consult the Title XVI Regional Chief Counsel (RCC) Precedents. For RCC precedents on trusts, see PS 01825.000.

If there are any unresolved issues requiring clarification that prevent you from determining the resource status of a trust, or there are issues for which you believe you need a legal opinion, follow your regional instructions or consult with your regional office (RO) program staff via vHelp. The RO staff can resolve many issues via vHelp. Once the specific question or issue submitted via vHelp is resolved, submit the case in SSITMS with the appropriate notes documenting the situation and resolution for the reviewer's reference for the resource determination. If necessary, the RO staff will seek guidance from the central office (CO) or OPLaw. Do not contact or refer materials to OPLaw directly.

If the State in question recognizes oral trusts as binding (see regional instructions):

• •

  record all relevant information;

• •

  obtain from all parties signed statements describing the arrangement; and

• •

  unless regional instructions specify otherwise, refer the case to your RO staff. The RO will refer the case, through the Assistant Regional Commissioner, Management and Operations Support (ARC, MOS), to OPLaw.

NOTE: The special needs trust and pooled trust exceptions do not apply in the case of an oral trust since these exceptions require written evidence as part of the trust document. For more information on the special needs trust and pooled trust exceptions, see SI 01120.203.

If the State does not recognize oral trusts as binding (see regional instructions), determine whether an agency relationship (a person acting as an agent of the individual) exists and develop under regular resource-counting rules or transfer of resources rules, as applicable. For transactions involving agents, see SI 01120.020.

Record all information used in determining whether the trust is a resource or generates income on the Trust page in the Supplemental Security Income Claims System (SSI Claims System). For more information on what trust information to record, see MS 08113.005. Record your rationales, summary of supporting documentation, and conclusions on the Report of Contact page (and subsequently lock it). When a certified electronic folder (EF) exists, upload the following into Section D (Non-Disability Development) of the Electronic Disability Collect System (EDCS):

• •

  a copy of the trust document (original not required), along with trust attachments, amendments (if any), joinder agreement (for pooled trusts), and exhibits;

• •

  copies of any signed agreements between organizations making payments to the individual and the individual legally entitled to such payments, if the payments have been assigned to the trust or trustee;

• •

  records of payments or disbursements from the trust, as necessary; and

• •

  any other pertinent documents, such as court orders, and the Form SSA-5002 (Report of Contact) that indicates the trust resource determination.

In the case of a paper folder, upload these materials into the Evidence Portal.

For more information on trust documentation and development, see the trust review process in SI 01120.200L in this section.

When listing the value of a trust with liquid assets, the field office (FO) technician may follow a high/low documentation option if the exact value is not material to the trust resource determination or claimant's eligibility. This means, if a trust has more than one liquid asset, you may use the highest verified value for any or all of them if doing so permits eligibility for all months in the period of review; or the lowest verified value for any or all of them if doing so results in ineligibility for all months in the period of review. If there is only one liquid asset, you may use the high/low option for any month within the period of review. Any high or low value used must be verified, and documentation must show that it applies throughout the period for which it is used. In addition, any non-liquid assets in the trust would be added to the selected liquid asset value when recording each monthly total value for the trust. Finally, for the first and final months of the review period, the verified values for all assets must be provided as the total value of the trust. FO technicians must still develop for distributions and additions, as discussed in SI 01120.200E to SI 01120.200G or SI 01120.201I to SI 01120.201J, in all months during the period of review. The high/low development policy does not change this requirement.

For documentation, the FO technician should:

1. 1. 

   Note if the high/low development policy was used and, if so, state the specific liquid asset with the high or low value selected for it on the Report of Contact;

2. 2. 

   Provide the total value of the trust as the selected liquid asset plus any nonliquid assets for the encompassed months of review on the Trust page; and

3. 3. 

   Provide the verified balance for all assets in the first and final months of the review period to reflect the total value of the assets in the trust on the Trust page.

Effective 04/27/18: If, due to a change in policy, a policy clarification, or reopening of a prior erroneous determination, a trust that was previously determined not to be a resource under SI 01120.200 is now determined to be a resource, offer a 90-day amendment period as described in this section and document verbal notifications in the claim file.

Tickle the case for follow-up in 90 days. If a trust was not previously counted as a resource, do not count the trust as a resource and do not impose an overpayment pending possible amendment within the 90-day period.

We permit each trust that was not previously determined to be a resource only one 90-day amendment period. However, you may grant a request for an extension to the 90-day amendment period for good cause, if the individual requests it and provides evidence that the disqualifying issue cannot be resolved within the 90-day period (for example, if a court must amend the trust and there is a wait to get on the court docket). Document on the Report of Contact page the decision to grant the extension, the time allowed, and the reason. Tickle the case for follow-up. Field office staff have discretion to allow a reasonable time period for a good cause extension depending on the situation.

If the trust is amended to be policy-compliant within the 90-day period (plus any extension), the trust continues not to be a resource for SSI purposes.

If the trust still fails to meet the policy requirements after expiration of the 90-day amendment period (plus any extension), count the trust as a resource beginning with the later of (1) the date when the policy change or clarification first applies to the trust or (2) the earliest date as of which the prior determination or decision is reopened and revised.

For all IC and PE cases where an applicant, recipient, or deemor alleges an interest in a trust that needs a resource determination, determine whether the trust is a countable resource. To make the trust resource determination, follow trust policy in SI 01120.200D in this section.

After making a trust resource determination:

1. 1. 

   Document the determination along with any references and rationale used in the decision-making process:

   • •

     For SSI Claims System cases, use the Report of Contact page; and

   • •

     For non-SSI Claims System cases, use a Form SSA-5002 (Report of Contact) and store it in the Evidence Portal.

2. 2. 

   Upload the initial trust resource determination, trust document(s), and any pertinent information into the Evidence Portal.

Then follow these trust review process steps:

Follow these procedures:

• •

  Access the SSITMS website and select the “Add New” tab. Add the applicant’s or recipient’s name, representative payee’s name (if any), social security number, and all other relevant trust information;

• •

  Select the appropriate type of trust in SSITMS (third-party trust, special needs trust, etc.);

• •

  Add remarks describing your determination and rationale; and

• •

  Submit the trust resource determination for RTRT review.

SSITMS sends an email notification after the trust reviewer (TR) or regional trust lead (RTL) reviews the trust resource determination and makes a decision. To view the RTRT’s response:

• •

  Access SSITMS and select the case from the Summary page listing or use the link in the email to access the case, and

• •

  Click on the “Details/Update” tab.

The Results field will show that the RTRT member either agreed or disagreed with the trust resource determination. When the Claims Specialist is ready to process the case, change the trust status to “FO Effectuated” using the Edit function.

To request a reevaluation of a trust resource determination that the FO disagrees with (after a decision has been made by the RTRT), access SSITMS and:

• •

  change the Trust Status to “Referred to RTL” using the Edit function; and

• •

  provide the rationale, a summary of supporting documentation, and appropriate references in SSITMS Remarks and select “Submit.”

The RTL will select the case for review and determine if the central office (CO) or the Office of Program Law (OPLaw) needs to review the case. The RTL will respond to the request via the SSITMS website, and SSITMS will send an email notification when the RTL completes the reevaluation process.

When the applicant or recipient appeals the trust resource determination, a Claims Specialist makes a proposed reconsideration determination, which the RTL must then review. To request a review of the proposed trust reconsideration determination, access SSITMS and:

• •

  select “Recon Pending” from the Recon Trust Status dropdown using the Edit function for that case; and

• •

  provide pertinent information about the reason for the appeal in Claims Specialist remarks and select “Submit.”

When the RTRT requires additional information from the FO, it will return the case for further development. SSITMS will send to the FO mailbox an email notification about the further development requested. To view the RTRT’s request, access SSITMS and:

• •

  select the case from the Summary page listings or use the link in the email to access the case; and

• •

  click on the “Details/Update” tab.

View the request for additional information in the Remarks field. After completing the development requested, update the Trust Status to “FO Development Completed” using the Edit button and submit.

Select the case from the SSITMS Summary listing page or by using the link in the email notification, and:

• •

  update the Trust Status field to "Review Initiated";

• •

  click the “Details/Update” tab;

• •

  review information provided by the Claims Specialist technician in the SSI Claims System and eView by using the Evidence Portal;

• •

  determine if consultation with CO or OPLaw is necessary;

• •

  provide the review results in the Remarks field;

• •

  update Trust Status to “Completed by RTL”; and

• •

  indicate “agree” or “disagree” with the Claims Specialist’s determination in Results and click “Submit.”

RTLs will receive an email notification whenever a trust resource determination needs reevaluation. To view the reevaluation request, access the case from the SSITMS Summary page listing.

To reevaluate the trust resource determination, follow steps listed in SI 01120.200L.3.a. in this section. The Claims Specialist who submitted the case and the Claims Specialist’s FO mailbox will receive an automated email notification when the RTL makes a decision. The subject line will show “Response to Trust for Reevaluation.”

SSITMS sends the RTL an email notification when they need to review an FO determination on a trust reconsideration. To view appeal requests, access the case from the SSITMS Summary page listing or from the link in the email notification. To review the reconsideration determination or address the appeal request, follow the steps listed in SI 01120.200L.3.a. in this section.

The Claims Specialist who submitted the case and the Claims Specialist’s FO mailbox will receive an automated email notification when the RTL makes a decision. The subject line will show “Response to SSI Trust Recon for Review.”

• •

  Situation

The claimant is a child and the beneficiary of a trust established on their behalf by their parent, who is their legal guardian. The money used to establish the trust was inherited by the claimant directly from their grandparent, making the beneficiary the grantor. The parent is also the trustee. The trust document indicates that the trust may be revoked at any time by the grantor.

• •

  Analysis

Since the grantor may revoke the trust at any time, the trust is a resource to the grantor. In this situation, the child is the grantor and the trust is their resource. This is the case because the actions of the parent, as legal guardian, are taken as an agent for the child. Be aware of situations in which the same person may serve multiple functions (such as parent, guardian, and trustee), and distinguish which specific function the person is performing in order to determine whether the person is acting as an agent for the claimant. Note that it is allowable for the same person to perform multiple functions independently of each other without acting as an agent of the claimant. For the definition of a grantor, see SI 01120.200B.3. in this section.

• •

  Situation

On April 21, 1998, the trust beneficiary, a 17-year-old SSI recipient, received a $125,000 judgment as the result of a car accident that left them disabled. Their parent, as their legal guardian, placed the money in an irrevocable trust for the sole benefit of the recipient with their sister as trustee. The trustee has absolute discretion as to how the trust funds are to be spent, and the trust has a prohibition against the trustee’s spending funds in a way or amount that would make the recipient ineligible for Federal or State assistance payments. There is no named residual beneficiary. Under the State law, if an individual is both the grantor of a trust and the sole beneficiary, the trust is revocable, regardless of language in the trust to the contrary.

• •

  Analysis

Since the recipient's parent, as their legal guardian, established the trust with funds that belonged to the recipient, we treat the recipient as having established the trust themselves. Therefore, they are the grantor of the trust. Since they are also the sole beneficiary of the trust, the trust is revocable under the State law and is the recipient's resource, regardless of the language in the trust document. The recipient is ineligible due to excess resources.

• •

  Situation

The SSI recipient is the beneficiary of an irrevocable trust created and funded by their deceased parents. Their sibling is the trustee. The terms of the trust give the sibling full discretionary power to withdraw funds for the recipient's educational expenses. The trustee uses these funds to pay the recipient's tuition and room and board at a boarding school. The trust pays $25 of monthly interest income into a separate account that designates the recipient as owner. They have the right to use these funds in any way they wish. The trust also contains a spendthrift clause that prohibits the trust beneficiary from transferring their interest in the trust payments prior to receipt; the spendthrift clause is valid under the State law.

• •

  Analysis

Since the recipient, as trust beneficiary, has no authority to terminate the trust established with their parents’ assets or to access the principal directly, the trust principal is not their resource. While trust disbursements for the beneficiary’s benefit may be income to them, the disbursements for tuition are not income since they do not provide food or shelter in any form. However, the trust disbursements for room and board are in-kind support and maintenance valued under the PMV rule. The $25 monthly deposits of trust earnings are income when deposited into the recipient's personal account and are resources to the extent retained into the following month. The trust beneficiary's right to the stream of $25 monthly payments is not a resource because they cannot sell or assign it prior to receiving the payments due to the valid spendthrift clause under the State law. For a definition of spendthrift clauses, see SI 01120.200B.13. in this section.

• •

  Situation

The claimant is a minor and the beneficiary of an irrevocable trust established in 1997 with the child's annuity payment by their parent, who is their representative payee. The parent is also the trustee. The claimant's siblings will become the trust beneficiaries in the event of the claimant's death. In the State where the claimant lives, the grantor can revoke the trust if they are also the sole beneficiary. The siblings are “residual beneficiaries” who become the beneficiaries upon the prior beneficiary's death.

• •

  Analysis

The trust principal is not a resource to the claimant. The trust document provides that the trust is irrevocable under the general rule in SI 01120.200D.2. in this section. Although the claimant is the grantor of the trust (because the actions of the parent as payee are as an agent of the claimant), the trust is not revocable under the rule for grantor trusts because the claimant is not the sole beneficiary, see SI 01120.200D.3. in this section.

• •

  Situation

The SSI claimant is the beneficiary of a revocable trust established with their parent’s assets for their future care. Their parent is their legal guardian. The claimant, as trust beneficiary, has no authority to terminate the trust. The claims specialist reviews the trust document to see if the claimant, through their legal guardian, have unrestricted access to the trust principal, whether the trust provides for payments on their behalf, and whether the trust principal generates income.

The trust document is very complex, and the fact that the claimant's parent is grantor, trustee, and their legal guardian further complicates the situation. The claims specialist cannot determine whether the trust principal is available to the trust beneficiary through the grantor or trustee.

• •

  Analysis

Because it is not clear from the trust document whether the parent, as legal guardian, “stands in the claimant's shoes” and controls the trust, the claims specialist consults with the RO staff for possible referral through the ARC, MOS, to OPLaw for an opinion.

• •

  Situation

The recipient is the beneficiary of an irrevocable trust. The trust document indicates that the recipient is the sole named beneficiary and also the grantor of the trust. The document also indicates that there are unnamed residual beneficiaries, the recipient's “heirs.”

• •

  Analysis

The adjudicator consults regional instructions on State law pertaining to grantor trusts. According to those instructions, a grantor trust may be a resource to the recipient, but the State law is unclear about the effect of the unnamed residual beneficiaries. The adjudicator consults with the RO staff for possible referral through the ARC, MOS, to OPLaw.

Except as provided in SI 01120.203A, this section applies to trusts “established with the assets of an individual.” A trust is considered to have been established with the assets of an individual if any assets of the individual (or spouse), regardless of how little, were transferred into the trust other than by a will. For the definition of an asset, see SI 01120.201B.1. in this section.

These provisions apply to trusts without regard to:

• •

  the purpose for which the trust was established;

• •

  whether the trustees have or exercise any discretion under the trust;

• •

  any restrictions on when or whether distributions may be made from the trust; or

• •

  any restrictions on the use of distributions from the trust.

Therefore, any trust established with the assets of an individual on or after 01/01/00 will be subject to these provisions and may count in determining SSI eligibility.

No clause or requirement in the trust, no matter how specifically it applies to SSI or another Federal or State program, can preclude a trust from being considered under the rules in this section. An exculpatory clause is one that attempts to exempt the trust from the applicability of these rules. For example, an exculpatory clause might state, “Section 1613(e) of the Social Security Act does not apply to this trust.” Such a statement has no effect on whether these rules apply to the trust.

In the case of an irrevocable trust into which the assets of the individual (or the individual’s spouse), along with the assets of another individual(s), are transferred, these provisions apply to the portion of the trust attributable to the assets of the individual (or spouse). Thus, in determining countable resources in the trust, you must prorate any amounts of resources, based on the proportion of the individual's assets in the trust.

EXAMPLE: Jimmy is an adult with cerebral palsy. Their grandparents left $75,000 in trust for them in their wills (third-party testamentary trust). Recently (after 01/01/00), Jimmy won an employment discrimination lawsuit and received a $1,500 judgment, which they deposited into the trust that their grandparents established. The $1,500 award is countable income in the month Jimmy receives the judgment because it is not irrevocably assigned to the trust. The $1,500 of Jimmy's funds are subject to these provisions and could be a resource if payment could be made to Jimmy or for their benefit (see SI 01120.201D.2. in this section). The $75,000 with which Jimmy’s grandparents established the trust, by will, for Jimmy’s benefit is not subject to these provisions but must be evaluated under the instructions for third-party trusts in SI 01120.200.

The following are examples of trusts to which the trust provisions in this section apply:

• •

  An individual who was the plaintiff in a medical malpractice lawsuit becomes the beneficiary of a trust under a settlement agreement. The agreement states that the defendant's insurance company established the trust instead of paying the settlement funds directly to the plaintiff. The settlement funds meet the definition of assets under SI 01120.201B.1. in this section because they are payments that the individual is entitled to but did not receive because they were made by an entity acting on behalf of or at the direction of the individual. Therefore, the trust was established with the assets of the individual.

• •

  The same result would occur if a court had ordered placement of the settlement in a trust, or if the individual was a child, regardless of whether State law requires placement of the settlement in a trust for the child.

• •

  A disabled SSI recipient over age 18 receives a settlement, which is deposited directly into a trust. In this example, the settlement is the recipient's income. Because the settlement is the SSI recipient’s income, the recipient is the grantor of the trust and the trust is a resource, unless it meets an exception in SI 01120.203.

If the trust meets an exception and is not a resource, the settlement would still be considered income unless it is irrevocably assigned to the trust or trustee. So, for instance, if a court had ordered the settlement to be paid directly into an excepted trust, we would consider the settlement to be irrevocably assigned to the trust/trustee, and we would not count it as income. Refer to SI 01120.201J.1.d. in this section regarding irrevocable assignment. 

The following are examples of trusts where the trust provisions in SI 01120.201 do not apply:

• •

  Lombardozi, age 67, has a settlement agreement due to an automobile accident that left them paralyzed in 1994. Under the agreement, they receive a lump-sum payment in March of each year. Since 1995, the annual lump-sum payments have been deposited into an irrevocable trust. We do not consider the payments received in 03/00 and years thereafter as establishing a trust for purposes of these provisions. They are additions to a trust established prior to 01/01/00 and are evaluated under SI 01120.200.

• •

  Same situation as the bullet above except that Lombardozi receives an inheritance of $3,000 that they deposit into the trust. We evaluate the trust under the rules in SI 01120.200 and the deposit of the inheritance as a transfer of resources under SI 01150.100.

• •

  Gates is a disabled child. Their grandparent established an irrevocable trust with $2,000, of which Gates is the beneficiary, in 12/97. Gates won a lawsuit in 02/00 and placed the money from the judgment ($50,000) in the trust that their grandparent established. Since Gates transferred money into the third-party trust after 01/01/00, the deposit of the judgment funds ($50,000) on or after 01/01/00 means that the individual’s portion is evaluated under the provisions in this section. The funds deposited by their grandparent are not evaluated under these provisions since they are funds of a third party subject to evaluation under SI 01120.200.

In the case of a revocable trust established with the assets of the individual, the entire corpus of the trust is a resource to the individual. However, certain exceptions may apply. For exceptions to counting trusts established on or after 01/01/00, see SI 01120.203. For instructions on revocability, see SI 01120.200D.1.b. and SI 01120.200D.3.

Any disbursements from a trust that is a resource that are not “to or for the benefit of” the individual are a transfer of resources. For information on payments for the benefit of or on behalf of the individual, see SI 01120.201F.1. in this section. For transfer of resource provisions, see SI 01150.100.

Jones is a young adult with intellectual disabilities. Jones had a revocable trust established after 01/01/00. Their guardian spent all but $5,000 of funds in the trust on Jones' behalf. Their parent files for SSI for Jones, but Jones is not eligible because of the money in the trust. Their parent takes a $4,500 disbursement from the trust and makes a down payment on a new car that the parent says they will use to transport Jones. However, the parent registers the car in their own name. Even though the parent will use the car to transport Jones, the purchase of the car is a transfer of resources since the car does not belong to Jones. For policy on purchases for the benefit of the individual and titling of property, see SI 01120.201F.1. in this section.

In determining whether an irrevocable trust established with the assets of an individual is a resource, we must consider how the trust can make payments. If the trustee can make any payments to or for the benefit of the individual or individual's spouse, the portion of the trust from which the trustee can make payments and that is attributable to the individual is a resource. However, certain exceptions may apply. For possible exceptions, see SI 01120.203. For information on payments for the benefit of or on behalf of the individual, see SI 01120.201F.1. in this section. For information on revocability, see SI 01120.200D.1.b.

Take into consideration any restrictions on payments to determine whether the trustee can make payments to or for the benefit of the individual. Restrictions included in the trust may include use restrictions, exculpatory clauses, or limits on the trustee's discretion. However, if the trust can make a payment to or for the benefit of the individual under any circumstance, no matter how unlikely or distant in the future, the general rule in SI 01120.201D.2.a. in this section applies: the portion of the trust from which payment can be made to or for the benefit of the individual and that is attributable to the individual is a resource, provided that no exception from SI 01120.203 applies. For information on payments for the benefit of or on behalf of the individual, see SI 01120.201F.1. in this section.

The following are examples of irrevocable trusts and their resource treatment:

• •

  An irrevocable trust provides that the trustee can make a one-time disbursement that totals $2,000 to, or for the benefit of, the individual out of a trust with $20,000 in assets. Only $2,000 is considered a resource under SI 01120.201D.2.a. in this section. The other $18,000 is considered to be an amount that cannot, under any circumstances, be paid to the individual and may be subject to the transfer of resources provisions in SI 01120.201E in this section, SI 01150.100, and SI 01150.121.

• •

  A trust contains $50,000 that the trustee can pay to the beneficiary only in the event that they need a heart transplant or on their 100^th birthday. The entire $50,000 could be paid to the individual under these specific circumstances and therefore is considered a resource.

• •

  An individual establishes an irrevocable trust with $10,000 of their assets. Their parents contribute another $10,000 to the trust. The trust permits distributions to, or for the benefit of, the individual only from the portion of the trust contributed by their parents. The portion of the trust contributed by the individual is not a resource under the provisions in this section because it is not available to them, but it is subject to evaluation under the transfer of resources provisions in SI 01150.100 (see also SI 01120.201E in this section). The portion of the trust contributed by the individual's parents is subject to evaluation under SI 01120.200.

We consider payments to be made to the individual when any amount from the trust, including amounts from the corpus or income produced by the trust, are paid directly to the individual or someone acting on their behalf, such as a guardian or legal representative.

For payments on behalf of or for the benefit of an individual, see SI 01120.201F.1. in this section. Also, for more instructions on disbursements from trusts, see SI 01120.201I in this section.

When all or a portion of the corpus of a trust, established with the individual’s or spouse’s resources, cannot be paid to or for the benefit of the individual, the portion that cannot be paid is considered a transfer of resources for less than fair market value.

Consider the date of the transfer to be:

• •

  the date the trust was established; or, if later,

• •

  the date payment to the individual was foreclosed (i.e., an action was taken that precludes current or future payments from the trust).

In determining the value of the transfer, do not subtract the value of any disbursements made after the date of the transfer, as determined according to the instructions in SI 01120.201E.1. in this section. Additions to the foreclosed portion of the trust after the date of the transfer may be new transfers that you must develop separately.

For instructions related to transfer of resources, see SI 01150.001.

When all or a portion of the corpus of a trust, established with the individual's or spouse's resources, is a resource to the individual and payment is made from that portion of the trust to or for the benefit of another, such a payment is a transfer of resources.

The following are examples of trusts where the transfer penalty applies.

• •

  Russell is an adult SSI recipient. Upon the death of their parent, Russell receives the proceeds of a life insurance policy in the amount of $30,000. They use the proceeds to establish an irrevocable trust solely to pay for the college expenses of their younger sibling, in accordance with their parent's wishes. Receipt of the insurance proceeds is income to Russell. Establishment of the trust is a transfer of resources by Russell since the terms of the trust foreclose payment to Russell or for their benefit. Even though establishing the trust was their parent's wish, they were not legally obligated to do so. Their parent could have established a trust in their will or named the younger sibling as beneficiary of the insurance policy.

• •

  Same scenario as in the first example, except that Russell establishes an irrevocable trust for the benefit of their sibling and themselves. The trust is a resource to Russell and makes them ineligible. The trust makes a $5,000 tuition payment to State College on behalf of their sibling. The $5,000 payment is a transfer of resources for Russell. Although counting the trust as a resource would make them ineligible, if the trust principal were spent down to the point where it would allow resource eligibility, we would still have to consider any tuition payments or other payments to or on behalf of their sibling made within the 36-month transfer look-back period. For more information on the transfer penalty, see SI 01150.110.

A non-resource asset is an asset that meets the definition in SI 01120.201B.1. in this section but does not meet the definition of a resource in SI 01110.100B.1. and SI 01110.115.

When we consider as a resource all or a portion of the corpus of a trust established by an individual or spouse with the individual's or spouse's non-resource assets, the transfer of resources penalty may apply in the following circumstances.

• •

  If an event occurs that forecloses payment from the portion of the trust that is a resource, then such foreclosure is a transfer of resources as of the date when payment is foreclosed. For the definition of foreclosure, see SI 01120.201B.8. in this section.

• •

  If payment to or for the benefit of another individual is made from the portion of the trust that is a resource, then such payment is a transfer of resources.

In determining the value of the transfer, do not subtract the value of any disbursements made after the date of foreclosure. Additions made by the individual to the foreclosed portion of the trust after the foreclosure date may be new transfers that you must develop separately.

For instructions related to transfers of resources, see SI 01150.100.

• •

  The key to evaluating this provision is that, when the trust makes a payment to a third party for goods or services, the goods or services must be for the primary benefit of the trust beneficiary. You should not read this so strictly as to prevent any collateral benefit to anyone else. For example, if the trust buys a house for the beneficiary to live in, that does not mean that no one else can live there, or if the trust purchases a television, that no one else can watch it. On the other hand, it would violate the sole benefit rule if the trust purchased a car for the beneficiary’s grandchild to take the beneficiary to their doctor’s appointments twice a month, but the grandchild was also driving it to work every day.

• •

  Purchased goods that require registration or titling, for example a car or real property, must be titled or registered in the name of the beneficiary or the trust(ee) unless State law does not permit it. For example, State law may not allow a car to be registered to the beneficiary, or may require a co-owner, if the beneficiary is a minor or an individual without a valid driver’s license. Some State Medicaid agencies may permit a car to be titled in a third party’s name if the trustee holds a lien on the car. A lien guarantees that the trust receives the value of the car if it is sold and prevents the purchase from being considered a transfer of resources.

  NOTE: 

  Even if a person or entity other than the beneficiary or the trust(ee) is listed on the title of the purchased good, it must still be used for the sole benefit of the trust beneficiary.

• •

  A third-party service provider can be a family member, a non-family member, or a professional services company. The policy is the same for all.

• •

  Payment for companion services can be a valid expense. For example, perhaps an Alzheimer’s patient cannot be left alone and requires a sitter, or the beneficiary needs someone to drive them to the store and assist them with grocery shopping. Family members may normally do some of these things without compensation, but that does not prohibit the trust from paying for these services. Additionally, some incidental expenses for the companion can be payable. For example, if the trust pays a companion to take the beneficiary to a museum, the trust can pay for the admission of the companion to the museum, as this cost is part of providing the service. For payment of travel expenses for a companion, see SI 01120.201F.3.b. in this section.

• •

  You should not request evidence of medical training or certification for family members who receive payment to provide care.

• •

  Do not request income tax information or similar evidence from a service provider to establish a business relationship. If a family member service provider’s income is relevant to the beneficiary’s SSI eligibility or payment amount (for example, their income is part of the beneficiary’s deeming computation as a deemor or ineligible child), request normal evidence of wages per SI 00820.130.

Apply the following instructions in evaluating whether travel expenses are allowable and do not violate the sole-benefit rule:

• •

  Travel expenses are transportation, lodging, and food.

• •

  Providing services or assistance necessary due to the trust beneficiary’s age means that the beneficiary is a minor and cannot travel unaccompanied.

• •

  Absent evidence to the contrary, accept a statement from the trustee that the service or assistance provided is necessary to permit the trust beneficiary to travel. Do not request a physician statement concerning medical necessity. You should not request evidence of medical training or certification for the person accompanying the trust beneficiary.

• •

  Use a reasonableness test in evaluating the number of people the trust is paying to accompany the beneficiary. For example, it is reasonable for a trust to pay for other individuals, such as parents or caretakers, to accompany a disabled minor child on vacation to provide supervision and assistance. Travel without this support would not be possible. However, it would violate the sole benefit rule if the trust paid for other individuals who are not providing services or assistance necessary for the beneficiary to travel.

The following travel expenses to ensure the safety or medical well-being of the trust beneficiary are allowable and do not violate the sole-benefit rule:

• •

  Travel for a service provider to oversee the trust beneficiary’s living arrangements when the beneficiary resides in an institution, nursing home, other long-term care facility (for example, group homes and assisted living facilities), or other supported living arrangements.

• •

  Travel for a trustee, trust advisor named in the trust, or successor to exercise their fiduciary duties or to ensure the well-being of the beneficiary when the beneficiary does not reside in an institution.

These provisions do not apply to a burial trust where:

• •

  an individual irrevocably contracts with a provider of funeral goods and services for a funeral; and

• •

  the individual funds the contract by prepaying for the goods and services; and either

• •

  the funeral provider subsequently places the funds in a trust; or

• •

  the individual establishes an irrevocable trust, naming the funeral provider as the beneficiary.

These provisions do not apply to a burial trust where:

• •

  an individual revocably contracts with a provider of funeral goods and services; and

• •

  the individual subsequently funds the contract by irrevocably assigning ownership of a life insurance policy to the provider; and

• •

  State law does not prohibit the individual from irrevocably assigning ownership of a life insurance policy to the funeral provider; and

• •

  the funeral provider subsequently places the life insurance policy in an irrevocable trust.

These transactions constitute a purchase of goods and services by the individual and the establishment of a trust with the funeral provider's funds, not with the funds of the individual.

Evaluate these arrangements under regular resource rules. Specifically, see the burial contract instructions in SI 01130.420 through SI 01130.425. However, if the individual who purchased the funeral was named as the beneficiary of the burial trust that the funeral provider established, and thus retains an equitable interest, see the instructions applicable to third-party trusts in SI 01120.200.

Cash paid directly from the trust to the individual is unearned income. We treat disbursements from the trust to the trust beneficiary’s personal debit card the same as cash disbursements. We count the disbursement as unearned income for the month the disbursement is received or added to the debit card.

If disbursements from the trust to third parties result in the beneficiary’s receiving non-cash items (other than food or shelter), the non-cash items are in-kind income if the items would not be a partially or totally excluded non-liquid resource if retained into the month after the month of receipt. For instructions on receipt of certain non-cash items, see SI 00815.550.

For example, if a trust buys a car for the beneficiary and the beneficiary's spouse already has a car that is excluded for SSI purposes, the second car is income in the month of receipt, since it would not be an excluded resource in the following month.

Food or shelter received as a result of disbursements from a trust to a third party is income in the form of in-kind support and maintenance (ISM) and is valued under the presumed maximum value (PMV) rule. For instructions pertaining to the PMV rule, see SI 00835.300. For rules pertaining to a home, see SI 01120.200F.

Disbursements from the trust that are not cash to the individual or are third-party payments that do not result in the receipt of support and maintenance are not income. Such disbursements may include, but are not limited to, those made for educational expenses, some travel expenses, therapy, medical services not covered by Medicaid, phone bills, recreation, and entertainment (see SI 00815.400).

Disbursements made from the trust to a third party that result in the beneficiary’s receipt of a non-cash item (other than food or shelter) are not income if the non-cash item would become a totally or partially excluded non-liquid resource if retained into the month after the month of receipt. For instructions on receipt of certain non-cash items, see SI 00815.550.

For example, a trust purchases a computer for the beneficiary. Since we would exclude the computer from resources as a household good in the following month, the computer is not income. For instructions on household goods, personal effects, and other personal property, see SI 01130.430.

If a trust pays a credit card bill for the trust beneficiary, whether the individual receives income depends on the list of itemized charges on the bill. If the trust pays for food or shelter items on the bill, we will generally charge the individual with ISM for those items up to the PMV. If the bill includes non-food, non-shelter items, the individual does not receive income as a result of the payment, unless the items received would not be totally or partially excluded non-liquid resources the following month.

EXAMPLE: If the credit card bill includes restaurant charges, payment of those charges results in ISM. If the bill also includes the purchase of clothing, payment for the clothing is not income.

Administrator-managed prepaid cards, such as True Link cards, are a type of restricted debit card that can be customized to block the cardholder’s access to cash, specific merchants, or entire categories of spending. Typically, the trustee is the account owner and administrator, and the trust beneficiary is the cardholder. To evaluate the income and resource implications of trust disbursements to administrator-managed prepaid cards, we must determine who owns the prepaid card account.

If the trustee is the owner of the prepaid card account:

• •

  Whether the trust beneficiary receives income from trust disbursements depends on the type of purchase reflected in the card statement. Treat purchases in the following manner:

  • •

    If the administrator-managed prepaid card is used to obtain cash, such as at an ATM, the withdrawal counts as unearned income.

  • •

    If the administrator-managed prepaid card pays for food or shelter items, such as charges at a restaurant, the individual will generally be charged with ISM up to the PMV. 

  • •

    If the administrator-managed prepaid card pays for non-food, non-shelter items, such as for clothing at a department store, the individual usually does not receive income unless the item received would not be a totally or partially excluded non-liquid resource the following month.

• •

  The administrator-managed prepaid card is not the trust beneficiary’s resource.

If the trust beneficiary is the owner of the prepaid card account:  

• •

  Count all disbursements from the trust onto the card as unearned income; and

• •

  Count any unspent balance on the card as a resource as of the beginning of the month after funds are loaded onto the card.

Consider gift cards and gift certificates purchased by the trust for the individual’s use to be cash equivalents. If the individual can use a gift card or certificate to buy food or shelter (such as a restaurant, grocery store, or VISA gift card), it is unearned income in the month of receipt. Any unspent balance on the gift card or certificate is a resource beginning the month after the month of receipt. If the store does not sell food or shelter items (such as a flower shop or electronics store), but the card does not have a legally enforceable prohibition on the individual’s selling the card for cash, then it is still unearned income. For general policy on gift cards and gift certificates, see SI 00830.522.

Reimbursements made from the trust to a third party for funds expended on behalf of the trust beneficiary are not income. In addition, reimbursements from the trust to pay a credit card belonging to a third party for purchases made for the trust beneficiary are not income.

Existing income and resource rules apply to items that a trust beneficiary receives from a third party. If a trust beneficiary receives a non-cash item (other than food or shelter), it is in-kind income if the item would not be a partially or totally excluded non-liquid resource if retained into the month after the month of receipt. If a trust beneficiary receives food or shelter, it is income in the form of ISM.

Funds transferred from the trust into an account established by the trust beneficiary under the Achieving a Better Life Experience (ABLE) Act are excluded from income to the trust beneficiary. For treatment of deposits into an ABLE account, see SI 01130.740.

If the trust principal (or a portion of the trust principal) is a resource to the individual, disbursements from the trust principal (or that portion of the principal) to or for the benefit of the individual are not income but conversion of a resource. However, we exclude from income any interest that the countable trust principal earns, per SI 00830.500.

For instructions pertaining to conversion of resources from one form to another, see SI 01110.100.

For instructions on treatment of earnings or additions when the trust principal is a resource, see SI 01120.201J.2. and SI 01120.201J.3. in this section.

In the case of a trust established with the assets of an individual (or their spouse), with respect to the trust (or portion of the trust) that is a resource:

• •

  If a disbursement is made other than to or for the benefit of the individual, consider such a disbursement a transfer of resources as of the date of the payment. For instructions on transfer of resources, see SI 01150.110.

• •

  If no disbursement could be made to the individual under any circumstances, consider the foreclosure of payment a transfer of resources as of the date of the foreclosure.

For a definition of “to or for the benefit of,” see SI 01120.201F.2. in this section.

Trust earnings are not income to an SSI applicant or recipient who is a trust beneficiary unless the trust directs, or the trustee makes, payment to the beneficiary.

Trust earnings are not income to the trustee or grantor unless designated as belonging to the trustee or grantor under the terms of the trust, for instance, as fees payable to the trustee or interest payable to the grantor.

Additions to the trust principal made directly to the trust are not income to the grantor, trustee, or beneficiary. Exceptions to this rule are noted in SI 01120.201J.1.c. and SI 01120.201J.1.d. in this section.

Certain payments are not assignable by law and, therefore, are income to the individual entitled or eligible to receive the payments under regular SSI income rules, unless an exclusion applies (e.g., SSI payments do not count as unearned income). Although a trust may be structured such that it appears that non-assignable payments are made directly into the trust, non-assignable payments may not be made directly into a trust to avoid income counting or for any other reason.

Important examples of non-assignable payments include:

• •

  Temporary Assistance for Needy Families (TANF);

• •

  Railroad Retirement Board-administered pensions;

• •

  Veterans' pensions and assistance;

• •

  Federal employee retirement payments (CSRS, FERS) administered by the Office of Personnel Management;

• •

  Social Security Title II and SSI payments; and

• •

  Private pensions under the Employee Retirement Income Security Act (ERISA) (29 U.S.C.A. § 1056(d)).

A legally assignable payment that is assigned to a trust or trustee is income for SSI purposes, to the individual entitled or eligible to receive the payment, unless an SSI income exclusion applies or the assignment is irrevocable. We consider assignment of payment by court orders to be irrevocable. For example, child support or alimony payments paid directly to a trust or trustee because of a court order are considered irrevocably assigned and thus not income. Also, U.S. Military Survivor Benefit Plan (SBP) payments assigned to a special needs trust are not income because the assignment of an SPB annuity is irrevocable. For more information on SPB annuities, see SI 01120.201J.1.e.

For non-assignable payments, see SI 01120.201J.1.c. in this section.

The Howard P. “Buck” McKeon National Defense Authorization Act for Fiscal Year 2015 gives military members and retirees the option to irrevocably direct payment of a Survivor Benefit Plan (SBP) annuity for a dependent child to a special needs trust for the benefit of a disabled child. Since the SBP annuity is irrevocably assigned to the special needs trust, the monthly annuity payments are not income to the trust beneficiary. Accept an assignment made in accordance with the applicable policies of the Department of Defense. For more information on special needs trusts, see SI 01120.203, and for more information on assignment of income, see SI 01120.201J.1.d. in this section.

Any earnings on and additions to a revocable trust are unearned income to the individual if:

• •

  the trust was established with the assets of the individual;

• •

  the individual is a beneficiary of the trust; and

• •

  the trust is a resource under this section.

For instructions on exclusion of interest income on earnings, see SI 00830.500.

EXCEPTION: If the source of any additions is the individual's resources, the additions are not income but conversion of a resource.

Any earnings on an irrevocable trust are unearned income to the individual in the percentage that they provided the assets that constitute the corpus of the trust.

This is the case if:

• •

  the trust was established with the assets of the individual;

• •

  the individual is a beneficiary of the trust;

• •

  the trust is a resource under this section; and

• •

  circumstances exist under which the trust can make payment from the trust earnings to or for the benefit of the individual.

For example, if the individual's assets constitute 75% of the trust corpus and the trust earns $100 interest in April, $75 of interest is income to the individual if the trust can pay the interest to or for the benefit of the individual. For instructions on exclusion of interest income, see SI 00830.500.

Any additions to an irrevocable trust are unearned income to the individual if:

• •

  the trust was established with the assets of the individual;

• •

  the individual is a beneficiary of the trust;

• •

  the trust is a resource under this section; and

• •

  circumstances exist under which the trust can make payment from the trust additions to or for the benefit of the individual.

EXCEPTION: If the source of the additions to the trust is the individual's other resource, then the additions are not income but conversion of a resource.

Prior to 04/27/18, there were only four instances where you could offer a 90-day amendment period:

• •

  Early Termination Provisions and Trusts (SI 01120.199);

• •

  Sole Benefit Requirement and Third-Party Travel Expenses (SI 01120.201F.2. and SI 01120.201F.3. in this section);

• •

  Pooled Trusts Management Provisions (SI 01120.225); and

• •

  Null and Void Clauses in Trusts Documents (SI 01120.227).

Continue to apply these policies, where applicable.

Effective 04/27/18: If, due to a change in policy, a policy clarification, or the reopening of a prior erroneous trust determination, a trust that was previously determined to be exempt from resource counting under Section 1917(d)(4)(A) or (C) is now determined to be a resource, offer a 90-day amendment period.

Tickle the case for follow up in 90 days. Do not count a previously excepted trust as a resource, and do not impose an overpayment, pending possible amendment within the 90-day period.

We permit each previously excepted trust only one 90-day amendment period. However, you may grant an extension request to the 90-day amendment period for good cause if the recipient requests it and provides evidence that the disqualifying issue cannot be resolved within the 90-day period (for example, if a court must amend the trust and there is a wait to get on the court docket). Document in the file the grant of an extension, the time allowed, and the reason. Tickle the case for follow-up.

If the trust is amended to be policy-compliant within the 90-day period (plus any extension), the trust continues to be excepted from resource counting.

If the trust still fails to meet the policy requirements after the expiration of the 90-day amendment period (plus any extension), begin counting the trust as a resource under normal resource counting rules. The trust principal becomes a countable resource beginning with the later of (1) the date when the policy change or clarification first affects the resource determination or (2) the earliest date as of which the prior determination or decision is reopened and revised.

Evaluate all trusts where an applicant, recipient, or spouse alleges an interest in a trust that needs a resource determination (such as a new or amended trust) in all initial claims (IC) and posteligibility (PE) events.

For PE events, do not reevaluate the trust resource determination (of a trust that has previously been reviewed) unless there is new and material evidence, such as an amendment to the trust or a clarification or change in policy that may affect the trust resource determination. However, evaluate all potential income implications, such as those of trust distributions and payments. For resource status changes in PE events, see SI 01120.201K.

Obtain a copy of the trust document (the original trust document is not required) and any related document(s) and review the document(s) to determine whether the:

• •

  individual is the grantor, trustee, or trust beneficiary;

• •

  trust was established before, on, or after 01/01/00;

• •

  assets were transferred into the trust before, on, or after 01/01/00;

• •

  trust was funded with assets of the individual or third parties or both;

• •

  trust is revocable or can be terminated and, if so, whether the individual has authority to revoke or terminate the trust and to use the principal for their own support and maintenance;

• •

  individual has access to the trust principal;

• •

  trust provides for or permits payments to the individual or on the individual’s behalf for the benefit of the individual;

• •

  trust principal generates income (earnings) and, if so, whether the individual has the right to any of that income;

• •

  trust provides for mandatory periodic payments and, if so, whether the trust contains a spendthrift clause that is valid under State law and prohibits the voluntary and involuntary alienation of any interest of the trust beneficiary in the trust payments; and

• •

  trust is receiving payments from another source.

Depending on the trust’s date of establishment and whose funds the trust principal contains, follow these instructions to determine the resource status and income treatment of the trust:

*If the SSI recipient is the beneficiary of an unfunded third-party trust (e.g., the trust will be funded upon the death of a parent), it is not necessary to review and submit the unfunded trust to SSITMS for SSI eligibility purposes until it is funded.

Consult any regional instructions that pertain to trusts to see if there are any State or Tribal laws to consider on such issues as revocability or irrevocability and grantor trusts. You may also consult the Title XVI Regional Chief Counsel (RCC) Precedents. For RCC precedents on trusts, see PS 01825.000.

If there are unresolved issues requiring clarification that prevent you from determining the resource status of a trust, or there are issues that you believe need a legal opinion, follow your regional instructions or consult with your RO program staff via vHelp. Once the specific question or issue submitted via vHelp is resolved, submit the case in SSITMS with the appropriate notes documenting the situation and resolution for the reviewer's reference for the resource determination. If necessary, the RO staff will seek guidance from the central office (CO) or the Office of Program Law (OPLaw). Do not contact or refer materials to OPLaw directly.

The field office may receive a request to reopen a trust resource determination by any party to the determination, including SSA, questioning its correctness. The request to reopen must be in writing and within the applicable time limit. For information on reopening SSI determinations, see SI 04070.015.

When applicable, issue a manual notice for trusts established with an individual’s assets on or after 01/01/00 as required per SI 01120.204. For such notices, specify using free-form text each reason the trust is countable (that is, why it does not meet the relevant exception(s) or requirements). In the notice, you must cite:

• •

  the applicable section of the trust (or any joinder agreement, if applicable) containing the problematic language or issue; and

• •

  the Program Operations Manual System (POMS) citation that contains the policy requirements on that subject.

Additionally, provide the following language indicating where the POMS can be found on-line: “You can find the Program Operations Manual System (POMS) on the Social Security website." For examples of manual notice language, see SI 01120.204.

If the State in question recognizes oral trusts as binding (see regional instructions):

• •

  record all relevant information;

• •

  obtain from all parties signed statements describing the arrangement; and

• •

  unless regional instructions specify otherwise, refer the case to your RO staff. The RO will refer the case, through the Assistant Regional Commissioner, Management and Operations Support (ARC, MOS), to OPLaw.

If the State does not recognize oral trusts as binding (see regional instructions), determine whether an agency relationship (a person or entity acting as an agent of the individual) exists and develop under regular resource-counting rules or transfer of resources rules, as applicable. For transactions involving agents, see SI 01120.020.

Obtain any written documentation and review the legal instrument or device to determine if it meets the requirements in SI 01120.201G.

If it does, determine whether the arrangement created by the legal instrument or device is a countable resource under regular SSI resource counting rules. If the resource is:

• •

  countable, develop the legal instrument or device under the other applicable resource rules.

• •

  not countable, develop the legal instrument or device following the procedures for developing trusts.

If you are unsure of whether the arrangement is one that you should develop as a legal instrument or device similar to a trust, refer the matter to the RO via the vHelp system. If necessary, the RO staff will seek guidance from the central office (CO) or OPLaw.

To submit your trust resource determination for RTRT review:

• •

  Access the SSITMS website and select the “Add New” tab. Add the applicant or recipient’s name, representative payee’s name (if any), social security number, and all other relevant trust information.

• •

  Select the appropriate type of trust in SSITMS (for example, third-party trust or special needs trust).

• •

  Add remarks describing your determination and rationale.

• •

  Submit the trust resource determination for RTRT review.

SSITMS sends an email notification after the trust reviewer (TR) or regional trust lead (RTL) reviews the trust resource determination and provides a response. To view the RTRT’s response:

• •

  Access SSITMS and select the case from the Summary page listing or use the link in the email to access the case, and

• •

  Click on the “Details/Update” tab.

The “Results” field will show that the RTRT member either agreed or disagreed with the trust resource determination. The RTRT member may provide feedback in the remarks field. When the Claims Specialist is ready to process the case, change the trust status to “FO Effectuated” using the “Edit” function.

To request a reevaluation of a trust resource determination that the FO disagrees with (after a decision has been made by the RTRT), access SSITMS and:

• •

  Change the Trust Status to “Referred to RTL” using the “Edit” function; and

• •

  Provide the rationale, a summary of supporting documentation, and appropriate references in SSITMS remarks and select “Submit.”

The RTL will select the case for review and determine if the central office (CO) or OPLaw needs to review the case. The RTL will respond to the request via the SSITMS website, and SSITMS will send an email notification when the RTL completes the reevaluation process.

When the applicant or recipient appeals the trust resource determination, the FO makes a proposed reconsideration determination, which the RTL must then review. To request a review of the proposed trust reconsideration determination, access SSITMS and:

• •

  Select “Recon Pending” from the Recon Trust Status dropdown using the “Edit” function for that case; and

• •

  Provide pertinent information about the reason for the appeal in FO remarks and select “Submit.”

When the RTRT requires additional information from the FO, it will return the case for further development. SSITMS will send an email notification about the further development requested to the FO mailbox. To view the RTRT’s request, access SSITMS and:

• •

  Select the case from the Summary page listings or use the link in the email to access the case, and

• •

  Click on the “Details/Update” tab.

View the request for additional information in the Remarks field. After completing the development requested, update the Trust Status to “FO Development Completed” using the “Edit” function and submit.

Select the case from the SSITMS Summary listing page or the link in the email notification and:

• •

  Update the Trust Status field to "Review Initiated."

• •

  Click the "Details/Update" tab.

• •

  Review information provided by the Claims Specialist in the SSI Claims System and eView by using the Evidence Portal (EP).

• •

  Determine if consultation with CO or OPLaw is necessary.

• •

  Submit pooled trust documents to OPLaw for a legal opinion when necessary.

• •

  Provide the review results in the Remarks field.

• •

  Update Trust Status to “Completed by RTL.”

• •

  Indicate “agree” or “disagree” with the FO’s determination in Results and click “Submit.”

For instructions on referring pooled trusts to OPLaw and establishing and managing pooled trust precedent files, see SI 01120.202C.3. in this section.

RTLs will receive an email notification whenever a trust resource determination needs reevaluation. To view the reevaluation request, access the case from the SSITMS Summary page listing.

To reevaluate the trust resource determination, follow the steps listed in SI 01120.202B.3.a. in this section. The Claims Specialist who submitted the case and the Claims Specialist’s FO mailbox will receive an automated email notification when the RTL makes a decision. The subject line will show “Response to Trust for Reevaluation.”

SSITMS sends the RTL an email notification when they need to review an FO determination on a trust reconsideration. An RTL who did not review the initial trust determination should review the FO reconsideration determination. To view appeal requests, access the case from the SSITMS Summary page listing or from the link in the email notification. To address the appeal request, follow the steps listed in SI 01120.202B.3.a. in this section.

The Claims Specialist who submitted the case and the Claims Specialist’s FO mailbox will receive an automated email notification when the RTL makes a decision. The subject line will show “Response to SSI Trust Recon for Review.”

If the precedent in SSITMS SharePoint is for the most current version of the master pooled trust, and the applicant or recipient submits a trust agreement that is the same version or an older version of the master agreement amended by the current version, you do not need to review the master agreement submitted to make your determination. Use the resource determination in the precedent file. However, review the joinder agreement for SI 01120.203 compliance. Additionally, note that, before using the resource determination in the precedent file, you should check to make sure that there have been no policy changes since the precedent determination that would affect the trust resource determination.

After determining the resource status of the master pooled trust and joinder agreements:

• •

  Document your determination and store the master agreement and joinder agreement in the Evidence Portal.

• •

  Continue the trust review process in SI 01120.202B in this section. See the example of a current precedent for a pooled trust in SI 01120.202H.8.a. in this section.

If the precedent in SSITMS SharePoint is for the most current version of the master pooled trust, but there has been a policy change since the precedent was established that may affect the resource determination for the master pooled trust, review the master agreement and joinder agreement for SI 01120.203 compliance, and take the following actions:

• •

  Document your determination and store the master agreement and joinder agreement in the Evidence Portal.

• •

  Continue the trust review process in SI 01120.202B. See the example of a current precedent for a pooled trust in SI 01120.202H.8.a. in this section.

If the applicant or recipient submits a new or amended version of a pooled trust master agreement and/or the precedent in the SSITMS SharePoint is not for the most current version of the trust or no precedent exists, review the master pooled agreement and joinder agreement for SI 01120.203 compliance. Then take the following actions:

• •

  Document your determination and store the master agreement and joinder agreement in the Evidence Portal.

• •

  Continue the trust review process in SI 01120.202B in this section. See the example of an outdated precedent for a pooled trust in SI 01120.202H.8.b. in this section.

Before adding or updating a pooled trust precedent in SSITMS SharePoint, RTLs must consult with OPLaw. After OPLaw evaluates the pooled trust documents, RTLs upload the trust precedent and related documents to the SharePoint site. Pooled trust precedents in SSITMS must contain the following information:

• •

  A copy of the master trust agreement;

• •

  A sample of a joinder agreement;

• •

  A copy of the OPLaw evaluation of the pooled trust; and

• •

  A precedent summary sheet containing the following information:

  1. a. 

     Title of the pooled trust.

  2. b. 

     Establishment date.

  3. c. 

     Amendment dates.

  4. d. 

     Resource determination (whether the master pooled trust agreement meets the requirements for exception) and date.

  5. e. 

     Evaluation of whether the master pooled trust meets each of the requirements in SI 01120.203D. State in the summary the specific reason why the pooled trust does not meet any requirement.

  6. f. 

     Conflicting trust provisions that render the trust countable: for example, a noncompliant early termination provision.

RTLs must consult with OPLaw before establishing and updating trust precedents in SSITMS SharePoint. OPLaw reviews all pooled trusts without a current precedent and provides a written evaluation on whether they meet the requirements for exception in section 1917(d)(4)(C) of the Act.

After consulting with OPLaw, RTLs add precedents to SSITMS SharePoint for all pooled trusts that do not have a precedent on file and update the precedents when pooled trusts have been amended.

1. 1. 

   Amended trusts that amend all prior versions

For amended trusts that amend all prior versions, update the precedent summary sheet with the most recent information for the pooled trust and note that the amendments apply to all prior versions of the trust. For example:

• •

  Add an amendment date and any reasons why the amended pooled trust is or is not in compliance.

• •

  Add to SSITMS the most recent versions of the master pooled trust and joinder agreement.

• •

  Do not delete prior versions of the pooled trust. Instead, identify them as “for historical purposes only.”

1. 2. 

   Amended trusts that do not amend all prior versions

For amended trusts that do not amend all prior versions, keep a precedent for each version of the master agreement. For example, keep and update the prior version of a precedent summary sheet, a copy of the master trust agreement, and a copy of the OGC evaluation for each version of the pooled trust.

Document the existence of a trust in the SSI Claims System by answering Yes on the Resource Selection page to the Trusts question. A Yes answer will bring the Trust page into the path.

• •

  Complete the applicable trust questions on the Trust page.

• •

  Enter the value of a trust that does not count as a resource in excluded amount, if an exception applies, and select the exclusion type (for example, meets special needs trust requirements or undue hardship) from the exclusion reason drop down menu.

• •

  Record all information used in determining whether the trust is a resource and whether it generates income in the Trust page in the SSI Claims System. For more information on what information to record, see MS 08113.005.

• •

  Record your conclusion and rationale on the Report of Contact page or SSA-5002 and store it in the Evidence Portal.

When listing the value of a trust with liquid assets, the field office (FO) technician may follow a high/low documentation option if the exact value is not material to the trust resource determination or claimant's eligibility. This means, if a trust has more than one liquid asset, you may use the highest verified value for any or all of them if doing so permits eligibility for all months in the period of review; or the lowest verified value for any or all of them if doing so results in ineligibility for all months in the period of review. If there is only one liquid asset, you may use the high/low option for any month within the period of review. Any high or low value used must be verified, and documentation must show that it applies throughout the period for which it is used. In addition, any non-liquid assets in the trust would be added to the selected liquid asset value when recording each monthly total value for the trust. Finally, for the first and final months of the review period, the verified values for all assets must be provided as the total value of the trust. FO technicians must still develop for distributions and additions, as discussed in SI 01120.201I to SI 01120.201J, in all months during the period of review. The high/low development policy does not change this requirement.

For documentation, the FO technician should:

1. 1. 

   note if the high/low development policy was used and, if so, state the specific liquid asset with the high or low value selected for it on the Report of Contact page;

2. 2. 

   provide the total value of the trust as the selected liquid asset plus any nonliquid assets for the encompassed months of review on the Trust page; and

3. 3. 

   provide the verified balance for all assets in the first and final months of the review period to reflect the total value of the assets in the trust on the Trust page.

Copy the trust information and send it to the same address used for assignment of rights (AOR) and third-party liability (TPL) information. See regional instructions or contact your RO staff for the correct address.

In States where SSA does not have an agreement to make the Medicaid eligibility determination:

• •

  copy the trust information and see, as applicable, regional instructions SI NY01150.110, SI DEN01150.110, and SI BOS01150.110; or

• •

  contact your RO staff for the correct address to send the information. For a discussion of section 209(b) and SSI criteria States, see SI 01715.010A.1. and SI 01715.010A.2.

A 20-year-old SSI claimant is the beneficiary of an irrevocable trust. The court established the trust in 02/2014 with the proceeds of the settlement of a lawsuit. The claimant lives with their parents, who support them fully. Their parents filed a medical malpractice suit on the claimant's behalf against their doctor. The doctor's insurance company settled the lawsuit before it went to trial for $400,000. The court approved the settlement agreement, whereby the insurance company placed the money in an irrevocable trust for the claimant, naming their parents as trustees. The trust permits payments for the claimant's special needs other than support and maintenance. The trust does not provide for reimbursement of Medicaid expenditures to the State on behalf of the claimant.

The trust was established with assets of the claimant. Although they never received them directly, the settlement proceeds meet the definition of assets in SI 01120.201B.2. Their parents, acting on their behalf, agreed to the settlement that established the trust. The court directed the proceeds to establish the trust after 01/01/00, so the instructions in SI 01120.201 apply. Although the trust is legally irrevocable under State law, it may be a resource because it permits disbursement of all the funds in the trust to or for the benefit of the claimant. The trust does not meet the exception for a special needs trust under SI 01120.203 because it does not require reimbursement of expenditures to the State(s) that provided medical assistance. Therefore, the trust is a resource in its full amount, $400,000. The claimant is ineligible due to excess resources.

Murray is an SSI recipient. Murray's spouse, who is not eligible, won $150,000 in the State lottery, of which Murray's spouse received $85,000. Murray's spouse used the money to establish the Murray Family Irrevocable Trust. The trust stipulates that Murray's spouse must use $40,000 for their child's college education. Murray's spouse can use the remainder of the money for a number of purposes, including supplemental needs for Murray and income payments to Murray's spouse, at the discretion of the trustee.

Since Murray's spouse established the trust with those assets and Murray's spouse can only pay $45,000 to or for the benefit of Murray, we will count $45,000 as a resource. We consider the remaining $40,000 in the trust a transfer of resources that we must evaluate under SI 01150.100.

Woody is a disabled young adult. In 08/2014, Woody's parents established an irrevocable special needs trust on Woody's behalf with $100,000 of their own funds. Prior to attaining age 18, Woody was ineligible because of the income and resources of Woody's parents through deeming. Now that Woody has attained age 18, Woody is reapplying for SSI.

Woody's resources do not include the trust established by Woody's parents since Woody was not the grantor of the trust, the trust is irrevocable, and Woody can't direct the use of the trust assets for Woody's support and maintenance. Thus, the trust is not a countable resource for SSI purposes. However, payments from the trust, to or for the benefit of Woody, may be income.

Becker is permanently disabled due to an injury they suffered in an automobile accident. Becker received a $3.5 million insurance settlement that they put into two irrevocable trusts. The first trust is a discretionary trust providing $2.5 million for the education and welfare of their children. The second trust is a charitable trust containing $1 million. The trustee must distribute annually the earnings on the trust in the form of scholarships for students at a nearby college.

Although Becker's trusts constitute a very large amount of money, none of the trust assets can be disbursed to them or to provide for their or their spouse's needs. SSA does not count the trusts as resources for SSI purposes. However, the establishment of the trusts is a transfer of resources under SI 01150.100. Becker will likely be ineligible for SSI for at least 36 months.

Walker, an SSI recipient, wishes to plan their funeral through a prepaid agreement. In the State where they live, recipients of public assistance, including SSI, must place the funds for their prepaid agreement into a funeral trust. Walker enters into a contract for a casket and vault valued at $5,000, and the funeral services they want are valued at $1,500. They place the full amount in a revocable trust. As required by State law, the trust shows Walker as the grantor and the funeral home as the trust beneficiary.

The revocable funeral trust is a resource under SSI burial trust policy in SI 01120.201H.2. because Walker is the grantor of the trust and the trust is revocable. The purpose of the trust is irrelevant for purposes of trust policy (see SI 01120.201C.2.d.).

However, since the trust is a resource, the SSI resource exclusions for burial spaces and funds apply. We exclude the vault and the casket as burial spaces. We exclude the $1,500 for funeral services under the $1,500 burial funds exclusion. Therefore, we exclude the total value of the trust. If the amount of funds for funeral services exceeds $1,500 (other than interest or appreciation), we would exclude up to $1,500, and the remaining amount would be countable.

For the burial space exclusion, see SI 01130.400, and for the burial fund exclusion, see SI 01130.409 through SI 01130.425.

Gonzales is a disabled adult SSI recipient. Gonzales received an award of $250,000 in a lawsuit in 06/2010 and the money went directly into a trust for their benefit. The trust does not meet any of the exceptions to the general SSI trust policy, so the trust would be a countable resource for SSI purposes. As a result, Gonzales has excess resources in 07/2010 (the month after the month in which the trust was established). The trustee uses all of the money in the trust to purchase a house for Gonzales (the trust holds the property title), and Gonzales moves into the home in 01/2011, when construction is completed. They contact SSA and inform us of what has happened.

Gonzales is ineligible due to excess income in 06/2010 and excess resources from 07/2010 to 01/11. When they move into the house in 01/2011, we consider them to be living in their own home because they have an equitable ownership interest under a trust. The house qualifies for the home exclusion as of 02/2011, and if Gonzales meets all other SSI eligibility requirements, we will reinstate their benefits. For information on the home resource exclusion, see SI 01120.200F.1.

Smith filed for SSI benefits on 04/21/09. During their initial interview, they provided The Brothers of Townsville Master Pooled Trust and their joinder agreement for our evaluation. The master agreement states that the trust was established on 11/12/07 and there is no evidence that it has been amended.

The precedent summary sheet in SSITMS SharePoint shows the trust was established on 11/12/07 and that it does not have any amendment dates. It also states that the master pooled trust meets the requirements of SI 01120.203 for exception.

Since SSITMS SharePoint has a current precedent on file for The Brothers of Townsville Master Pooled Trust, and there have not been any trust policy changes since 11/12/07 that would affect the resource determination in the precedent, we adopt the precedent determination for Smith’s pooled trust, evaluate the joinder agreement for compliance, document on the Report of Contact page, and submit our request for RTRT review via SSITMS.

During Baker’s redetermination (RZ) on 06/02/10, they provided The Brothers of Townsville Master Pooled Trust and their joinder agreement for our evaluation.

The master agreement states the trust was established on 11/12/07 and amended on 10/24/09.

The precedent summary sheet in SSITMS SharePoint shows the trust was established on 11/12/07, but does not indicate any amendments.

The precedent in SSITMS SharePoint is not up-to-date. Therefore, we evaluate the master and joinder agreements for compliance, document our determination, and submit our determination via SSITMS for review.

Once OPLaw evaluates the amended trust agreement, the RTL updates the precedent summary sheet in SSITMS SharePoint with the new determination information and a copy of the amended trust and updates all other trust-related documents.

Moore reports during their RZ interview on 10/08/15 that they are a trust beneficiary of the Greater Los Angeles Master Pooled Trust. Their account was established in 07/2015. Moore submits their trust documents for our evaluation. We do not have a precedent in SSITMS SharePoint for the Greater Los Angeles Master Pooled Trust.

The Greater Los Angeles Master Pooled Trust was established on 05/15/08 and amended 06/04/12. The amendments do not apply to the prior version. We do not need to evaluate the 05/15/08 version of the master agreement to make a determination in Moore’s case, because their trust was established under the 06/04/12 amended version of the trust. Therefore, we evaluate the 06/04/12 amended master trust agreement and joinder agreement for compliance and submit our determination via SSITMS for review.

Once OPLaw evaluates the trust, the RTL creates a precedent for the Greater Los Angeles Master Pooled Trust that includes all the items listed in SI 01120.202C.3. in this section.

If another applicant who has a trust established under the original 2008 version of the trust submits a copy later (because the 2012 amendments do not apply to the 2008 version), establish a separate precedent for the 05/15/08 version of the trust.

Scenario A: trust precedent is not current and 90-day trust amendment period does not apply

Thompson has been a trust beneficiary of The Brothers of Townsville Master Pooled Trust since 02/01/08 and an SSI recipient since 2003. They reported the trust for the first time during an RZ interview in 08/20/15 and submitted their master and joinder trust documents. The Brothers of Townsville Master Pooled Trust has been amended three times, on 10/24/09, 03/18/12, and 02/15/13, and the amendments apply to prior versions. Our precedent file is not current because it shows that the master trust meets the requirement for exception based on the amended version of 03/18/12.

During Thompson’s RZ, we evaluate the 02/15/13 amended version of the master pooled trust, because it is the most recent, and their joinder agreement. OPLaw finds that the 02/15/13 version does not meet the requirements for exception. We document the trust determination and count the balance of the trust as a resource back to the start of the period of review based on administrative finality.

Scenario B: trust precedent is not current and 90-day trust amendment period applies

Thompson has been a trust beneficiary of The Brothers of Townsville Master Pooled Trust since 02/01/08 and an SSI recipient since 2003. We first excepted their pooled trust from resource counting in 03/2008. During an RZ interview on 08/20/15, Thompson submitted a copy of 02/15/13 amended master and joinder trust documents. The Brothers of Townsville Master Pooled Trust has been amended three times, on 10/24/09, 03/18/12, and 02/15/13, and the amendments apply to prior versions. Our precedent file is not current because it shows that the trust meets the requirements for exception as a resource based on the amended version of 10/24/09.

During Thompson’s RZ, we evaluate the 02/15/13 version of the master pooled trust, because it is the most recent, and their joinder agreement. OPLaw finds that the 02/15/13 version does not meet the requirements for exception because the early termination provision is noncompliant.

Since we had previously excepted The Brothers of Townsville Master Pooled Trust in Thompson’s record (in 03/2008), we follow instructions in SI 01120.199 and offer them 90 days to amend the trust. On 11/11/15, the trust is amended and becomes compliant. Since the trust was amended during the amendment period, the trust remains excepted from resource counting during the amendment period and continuing.

Scenario C: trust amendments do not cover the entire period of review

Thompson has been a trust beneficiary of The Brothers of Townsville Master Pooled Trust since 02/16/08 and an SSI recipient since 2003. We first excepted their pooled trust from resource counting in 03/2008. During an RZ interview on 08/20/15, Thompson submitted a copy of 12/15/13 amended master and joinder trust documents. The Brothers of Townsville Master Pooled Trust has been amended three times, on 10/24/09, 03/18/12, and 12/15/13. Our precedent file is not current because it shows that the trust meets the requirements for exception as a resource based on the amended version of 10/24/09.

Thompson’s RZ period of review is 08/13 through 08/15. We evaluate the 12/15/13 version of the master pooled trust because it is the most recent and covers the period 12/13 to 08/15 and the 03/18/12 version of the trust because it is applicable to the other part of the period of review (08/13 – 12/13). (The 12/15/13 version of the trust amended the 03/18/12 version of the trust, but only after 12/15/13. The 12/15/13 amendment is not retroactive to 03/18/12.) We also evaluate their joinder agreements. OPLaw finds that the 03/18/12 version of the trust is compliant, but the 12/15/13 version does not meet the requirements for exception because the early termination provision is noncompliant.

Since we had previously excepted The Brothers of Townsville Master Pooled Trust in Thompson’s record (in 03/2008), we follow instructions in SI 01120.199, and offer them 90 days to amend the trust. On 11/11/15, the trust is amended and becomes compliant. Since the trust was amended during the amendment period, the trust remains excepted from resource counting during the amendment period and continuing.

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  Use the SSA-3367 to notify DDS of the SSI POD. See DI 25501.220 and DI 11005.045.

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    Show an SSI POD equal to the first of the month of the SSI application date (protective filing date or application receipt date if no protective filing exists).

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    Select POD reason as "Other". Explanation: “SSI Trust resource involved. POD represents first of the month in which the individual could be eligible for SSI. See SI 01120.203B.4.”

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  If a current Title II medical allowance exists, follow instructions in DI 11011.001. The DDS has jurisdiction for all potential collateral estoppel claims.

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  On the Trust page in the SSI Claims path (MS 08113.005) do not show any value in the "Excluded Amount(s)" column. Leave this blank.

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  Hold the case in H80 payment status pending the DDS determination.

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  If disability onset is the first of the month in which the individual could be eligible for SSI, the trust meets the disability requirement for exception; or

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  If disability onset is NOT the first of the month in which the individual could be eligible for SSI, the trust will not meet the disability requirement for exception until the month following the disability onset date given the FOM rules for making resource determinations in SI 01110.600.

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  Use the DDS determination for proper completion of the "Excluded Amounts(s)" column on the Trust page in the SSI Claims path (MS 08113.005)

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  Process the case to pay or denial.

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  For resource transfers to a trust, consider whether a period of ineligibility applies for transferring a resource for less than fair market value – see SI 01150.110. Consider also whether one of the exceptions for transfers to a trust applies in SI 01150.121.

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  Generally, a period of ineligibility does not apply to transfers to a trust that is a countable resource (SI 01150.121A.1.). This is to avoid both counting the trust as a resource and imposing a transfer of resources penalty for the same transaction. Per SI 01120.201D.5., the trust instructions take precedence over the transfer instructions.

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  For transfers to a trust occurring within the look-back period (SI 01150.110C), we may have to develop disability as of the date on which the resource transfer occurred in order to determine whether a period of ineligibility – or an exception to the penalty – applies to the transfer.

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  Mark, a special needs trust beneficiary whose trust was established in 2015 when Mark was 64 years old, applies for SSI Aged benefits on June 15, 2019. Even though disability is not a requirement for SSI Aged benefits, we must develop disability as of June 1, 2019, when the trust's resource status could affect Mark's SSI eligibility.

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  Sally has a special needs trust that was established in 2010 when Sally was 10 years old. At the time, Sally was not eligible for SSI Child benefits because of their deeming parents' income and resources. However, Sally applies for SSI Adult benefits with a protective filing date of April 15, 2018. We must develop disability as of April 1, 2018. The 2010 trust establishment date is not relevant because the trust did not present as a resource issue until the month it could affect Sally's eligibility for SSI (April 2018).

In the case of a legally competent, disabled adult, a parent or grandparent may establish a “seed” trust using a nominal amount of their own money or, if State law allows, an empty or dry trust. After the seed trust is established, the legally competent, disabled adult may transfer their own assets into the trust, or a different individual or entity with legal authority may transfer the disabled individual's assets into the trust.

A power of attorney (POA) can establish legal authority to act with respect to the assets of an individual. A trust established under a POA for the disabled individual will result in a trust that we consider to be established through the actions of the disabled individual themselves because the POA establishes an agency relationship.

The person or entity establishing the trust with the assets of the legally competent, disabled individual or transferring the assets of the individual to the trust must have legal authority to act with respect to the assets of the individual. Attempting to establish a trust with the assets of another individual without proper legal authority to act with respect to the assets of that individual will generally result in an invalid trust under State law.

John is a legally competent adult who inherited $250,000 in January 2015, and is an SSI recipient. John's sibling, Justine, petitioned the court to create and order the funding of the John Special Needs Trust. Justine also provided the court with an unsigned draft of the trust document. A month later, the court approved the petition and issued an order requiring the creation and funding of the trust. This trust meets the requirement in SI 01120.203B.7. in this section. The fact that the trust beneficiary is a competent adult and could have established the trust themselves, is not a factor in the resource determination.

Henry wins a lawsuit in the amount of $50,000. As part of the settlement, the judge orders the creation of a trust in order for Henry to receive the $50,000. As a direct result of this court order, a trust was created with Henry’s settlement money. The trust document lists the $50,000 as the initial principal amount in Schedule A of the trust. This trust meets the requirement for exclusion in SI 01120.203B.7. in this section.

Jane is ineligible for SSI benefits because Jane has a self-established special needs trust that does not meet the requirements for exception in SI 01120.203 in this section. Jane petitioned the court to establish an amended trust and to make the order retroactive, so that Jane's original trust would become exempt from resource counting from the time of its creation. The court approved the petition and issued a nunc pro tunc order stating that the court established the trust as of the date on which Jane had previously established the trust themselves. The court did not establish a new trust; it merely approved a modification of a previously existing trust. The amended trust does not meet the requirement for exclusion in SI 01120.203B.7. in this section.

Dan is the beneficiary of a special needs trust. Dan's sibling petitioned the court to establish the Dan’s Special Needs Trust and submitted to the court along with the petition Dan’s special needs trust that had already been signed and funded. Although the court order states that it approves and establishes the trust, the court simply approved the existence of the already established special needs trust. This trust does not meet the requirement in SI 01120.203B.7. in this section. For an example of an unsigned and unfunded trust, see SI 01120.203B.7.a.

In the case of a legally competent, disabled adult, a parent or grandparent may establish a “seed” trust using a nominal amount of their own money or, if State law allows, an empty or dry trust. After the seed trust is established, the legally competent, disabled adult may transfer their own assets into the trust, or a different individual or entity with legal authority may transfer the disabled individual's assets into the trust.

A power of attorney (POA) can establish legal authority to act with respect to the assets of an individual. A trust established under a POA for the disabled individual will result in a trust that we consider to be established through the actions of the disabled individual themselves because the POA establishes an agency relationship.

The person or entity establishing the trust with the assets of the legally competent, disabled individual or transferring the assets of the individual to the trust must have legal authority to act with respect to the assets of the individual. Attempting to establish a trust with the assets of another individual without proper legal authority to act with respect to the assets of that individual will generally result in an invalid trust under State law.

In the case of a legally competent, disabled adult, a parent or grandparent may establish a “seed” trust using a nominal amount of their own money or, if State law allows, an empty or dry trust. After the seed trust is established, the legally competent, disabled adult may transfer their own assets into the trust, or a different individual or entity with legal authority may transfer the disabled individual's assets into the trust.

A power of attorney (POA) can establish legal authority to act with respect to the assets of an individual. A trust established under a POA for the disabled individual will result in a trust that we consider to be established through the actions of the disabled individual themselves because the POA establishes an agency relationship.

The person or entity establishing the trust with the assets of the legally competent, disabled individual or transferring the assets of the individual to the trust must have legal authority to act with respect to the assets of the individual. Attempting to establish a trust with the assets of another individual without proper legal authority to act with respect to the assets of that individual will generally result in an invalid trust under State law.

John is a legally competent adult who inherited $250,000 and is an SSI recipient. John's sibling, Justine, petitioned the court to create and order the funding of an account in the Chesapeake Pooled Trust. Justine also provided the court with an unsigned draft of the trust document. A month later, the court approved the petition and issued an order requiring the creation and funding of the trust account. This trust account meets the requirement in SI 01120.203D.6. in this section. The fact that the trust beneficiary is a competent adult and could have established the trust account themselves, is not a factor in the resource determination.

Mary, a legally incompetent SSI recipient, wins a lawsuit in the amount of $50,000. As part of the settlement, the judge orders the creation of a pooled trust account in order for Mary to receive the $50,000. As a direct result of this court order, a pooled trust account was created with Mary’s settlement money. The pooled trust records and documentation of the initial deposit list the $50,000 as the initial principal amount. This trust account meets the requirement in SI 01120.203D.6. in this section.

Jane has a self-established pooled trust account. Jane is ineligible for SSI benefits because the pooled trust does not meet one of the requirements for exception in SI 01120.203D. Specifically, the pooled trust has to be established and managed by a nonprofit association. A for-profit association is managing Jane’s pooled trust. The pooled trust changed management to a nonprofit association to satisfy the requirement. Jane petitioned the court to establish an amended trust account joinder agreement and to make the order retroactive, so that Jane's original trust account would become exempt from resource counting from the time of its creation. The court approved the petition and issued a nunc pro tunc order stating that the court established the trust account as of the date on which Jane had previously established the trust account themselves. The amended trust account joinder agreement does not meet the requirement in SI 01120.203D.7. in this section. The court did not establish a new trust account; it merely approved a modification of a previously existing trust account joinder agreement.

For purposes of the trust provisions of section 1613(e) of the Act, undue hardship exists in a month if:

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  failure to receive SSI payments would deprive the individual of food or shelter; and

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  the individual's available funds do not equal or exceed the Federal benefit rate (FBR) plus any federally administered State supplement.

For purposes of undue-hardship waiver in the context of section 1613(e) of the Act, an individual would be deprived of shelter if:

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  they would be subject to eviction from their current residence, if SSI payments were not received; and

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  there is no other affordable housing available, or there is no other housing available with necessary modifications for the disabled individual.

We will consider the possibility of undue hardship under this provision only when:

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  counting an irrevocable trust as a resource results in the individual's ineligibility for SSI due to excess resources;

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  the individual alleges (or information in the file indicates) that not receiving SSI would deprive the individual of food or shelter, with their statement subsequently obtained for the file; and

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  the trust specifically prohibits disbursements, or prohibits the trustee from exercising their discretion to disburse funds, from the trust for the individual's support and maintenance.

An irrevocable trust is not counted as a resource in any month for which counting the trust would cause undue hardship.

Resource counting of a trust resumes for any month(s) for which it would not result in undue hardship.

Income includes the following:

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  All countable income received in the month(s) for which undue hardship is an issue;

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  All income excluded under the Act received in the month(s) for which undue hardship is an issue. For a list of unearned and earned income exclusions, respectively, provided under the Act, see SI 00830.099 and SI 00820.500; and

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  The value of in-kind support and maintenance (ISM) being charged, i.e., the presumed maximum value (PMV), the value of the one-third reduction (VTR), or the actual lesser amount.

Do not include SSI payments received or items that are not income, per SI 00815.000.

Resources include the following:

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  All countable liquid resources as of the first moment of the month(s) for which undue hardship is at issue (for a definition of liquid resources, see SI 01110.300); and

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  All liquid resources excluded under the Act as of the first moment of the month(s) for which undue hardship is at issue (for a list of resource exclusions under the Act, see SI 01130.050).

SSI benefits retained into the month following the month of receipt are counted as a resource for purposes of determining available funds.

Do not include non-liquid resources or assets determined not to be a resource, per SI 01120.000.