SSA - POMS: SI 01120.195 - Trusts Established under the Indian Gaming Regulatory Act (IGRA) for Minor Children and Legally Incompetent Adults (IGRA Trusts)

A. Introduction to evaluating IGRA trusts

This section provides instructions for evaluating IGRA trusts established by Indian tribes for tribal members who are minor children or incompetent adults.

B. Background on Indian Gaming Regulatory Act of 1988 (IGRA)

The Department of the Interior (DOI) regulates Indian gaming under the provisions of IGRA. IGRA explains how a tribe may allocate its gaming revenues.

Under IGRA, a tribe can issue a portion of its gaming revenues to individual tribal members in the form of per capita payments. IGRA requires a tribe to protect and preserve the interest of minor children and incompetent adults who are entitled to receive per capita payments. Tribes may establish IGRA trusts for such individuals to safeguard these payments and reduce income tax liability for the individuals.

When a tribal member who has an IGRA trust files for Supplemental Security Income (SSI), we must first determine whether the tribe or the member is the grantor of the trust. Then we must determine how to count assets held in the IGRA trust under our resource counting rules.

NOTE: We based our procedures in this section for determining the trust grantor on Internal Revenue Service (IRS) guidelines for analyzing IGRA trusts for income tax purposes.

C. Definitions related to IGRA trusts

The following definitions apply to terms commonly used in IGRA trusts. With the exception of “certification letter,” these definitions stem from regulations or other authorities issued by the DOI’s Bureau of Indian Affairs (BIA) or the IRS.

1. Certification letter

A certification letter is a written statement issued by the Indian tribe certifying that an individual is an enrolled member of the tribe and has a beneficial ownership interest in the tribe’s IGRA trust. A certification letter may be used in lieu of a joinder agreement.

2. IGRA trust

An IGRA trust is a trust that an Indian tribe establishes under IGRA to receive and invest per capita payments for its members who are minors or legal incompetents pending distribution of the trust assets to those members after they attain the age of majority or cease to be legal incompetents.

3. Legally incompetent adult (or legal incompetent)

A legally incompetent adult is an individual, other than a minor, who is eligible to participate in a per capita payment and who has been declared to be under a legal disability, by a court of competent jurisdiction, including tribal justice systems or as established by the tribe.

4. Minor child (or minor)

A minor child is an individual who is eligible to participate in a per capita payment and who has not reached the age of 18 years.

5. Per capita payment

A per capita payment is a distribution of money or other thing of value to all members of the tribe, or to certain identified groups of members. For IGRA trusts, tribes make these payments directly from the net revenues of any tribal gaming activity.

D. Policy for determining the grantor of an IGRA trust

In 2014, we had a change of position affecting how we determine when an Indian tribe can be the grantor of an IGRA trust for the minor child or legally incompetent adult.

NOTE: For additional instructions on processing cases affected by this change of position and rules for reopening prior determinations, see SI 04070.040C.

1. IGRA trust resource determinations made December 1, 2014 or after

If an IGRA trust substantially complies with the requirements in SI 01120.195E in this section, we will treat the Indian tribe as the grantor of the trust.

If we determine that the tribe is the grantor of the IGRA trust, follow policy in SI 01120.200 to determine if the trust is a resource and if disbursements from the trust are countable income.

If we determine that the tribe is not the grantor of the IGRA trust, follow policy in SI 01120.201 to determine if the trust is a resource and if disbursements from the trust are countable income.

2. IGRA trust resource determinations made prior to December 1, 2014

Treat the minor child or incompetent adult as the grantor of the IGRA trust. Follow policy in SI 01120.201 to determine if the trust is a resource and if disbursements from the trust are countable income.

E. Requirements for treating the Indian tribe as the grantor of an IGRA trust

SSA treats the Indian tribe as the grantor of an IGRA trust if the trust substantially complies with the following requirements:

1.

The Indian tribe establishes the trust for the benefit of tribe members who are minors and/or legally incompetent adults and it funds the trust using only per capita payments from gaming revenues.
2.

The trust beneficiary is a minor or legally incompetent adult at the time the trust (or trust account) is established.
3.

The trust only allows contributions while the beneficiary is still a minor or legally incompetent.
4.

The trust instrument states that the Indian tribe is intended to be the grantor of the trust, and grants to the Indian tribe a power or interest in the trust assets, such as the ability to vote any shares held in trust.
5.

The Indian tribe is the owner of the trust for tax purposes and all the trust assets and the trust principal and income are subject to claims of general creditors of the Indian tribe under applicable federal, state, local, and tribal law.
6.

At all times while the trust is in effect, the principal and income of the trust must be subject to claims of general creditors under applicable law. In addition, the trust documents must require the trustee to cease payments to or for the benefit of the beneficiary, and must require that the trustee hold trust assets for the benefit of the Indian tribe’s general creditors throughout any period during which the trustee believes or has reason to believe that the Indian tribe is unable to pay its debts as they become due, or is subject to a pending insolvency or bankruptcy proceeding.
7.

The trust beneficiary does not have any preferred claim or beneficial ownership interest in any assets of the trust, and any rights created under the trust documents must be unsecured rights. In addition, amounts payable to, or for their benefit, cannot be anticipated, assigned (either at law or at equity), alienated, pledged, encumbered or subjected to garnishment, levy, or other legal or equitable process.
8.

Trust assets are not available to or for the benefit of the beneficiary until the beneficiary ceases to be a minor or legal incompetent, except for the distributions for the beneficiary’s health, education, or welfare made at the discretion of the trustee and pursuant to the trust instrument.
9.
Upon the beneficiary’s death, the beneficiary’s share must be paid to the Indian tribe, unless the trust document provides for payment either:
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  to persons who may inherit from the beneficiary under applicable state or tribal inheritance laws; or
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  based on the terms of a valid will or trust of the beneficiary.

NOTE: An IGRA trust may provide that after the beneficiary ceases to be a minor child or legally incompetent adult, the trust may make distributions to or for the benefit of the beneficiary at a specified age or upon the occurrence of a specified event. Such a provision in the trust does not affect the determination that the tribe is the grantor of the IGRA trust.

EXAMPLE: The IGRA trust states that the beneficiary (a minor child) will receive funds from the trust when the beneficiary attains age 18, but only if they have graduated from high school.

F. Reviewing IGRA trusts

For IGRA trusts, we use a precedent-based review system. This process requires a one-time review of the relevant trust documents by the jurisdictional RCC (determined by the location of the tribe’s headquarters), including evidence that the DOI has approved the trust as an IGRA trust. After the RCC drafts an opinion about who the grantor of the master trust is, the Regional Trust Lead (RTL) evaluates the opinion in conjunction with any other relevant information, and publishes a precedent in the SSI Trust Monitoring System (SSITMS). The field office (FO) uses that precedent, along with a tribal member’s joinder agreement or certification letter, to make an initial trust resource determination. The FO then follows the regular trust review process of inputting their initial determination into SSITMS for RTL review and FO effectuation, as outlined in this section.

NOTE: Documents regarding the IGRA trust, including any amendments to the documents, must be provided to the agency. Tribal members or the tribe itself may submit IGRA trust documents through a Regional Communications Director (RCD), Public Affairs Specialist (PAS), or FO Management in lieu of an FO technician.

FO technicians and RTLs must follow these steps to make an IGRA trust resource determination under the precedent-based review system.

1. SSA receives trust documents

When we receive a trust document, joinder agreement, or certification letter, check the SSITMS SharePoint Repository for Precedents to see if a precedent exists for the trust by taking the following actions:

a.

Access the SSITMS website.
b.
Use the SSITMS “Help” link to access the SharePoint Repository for Precedents. The “Help” link also contains a user guide with instructions for using the SSITMS website.
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  If a precedent exists, skip to Step 3.
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  If there is no precedent, email all documents to the RTL for referral to the jurisdictional RCC. Upon receiving an alert back from the RTL that the precedent is ready, go to Step 3.

2. RTL establishes trust grantor precedent based on RCC opinion

Once the RCC reviews the trust and drafts an opinion about the grantor of the trust, the RTL takes the following actions:

a.

Use the RCC opinion, together with any other relevant information, to establish a trust precedent and upload the precedent to the SSITMS SharePoint Repository for Precedents.
b.
Include in the precedent:
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  copy of the master trust agreement;
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  sample certification letter or joinder agreement;
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  copy of the RCC opinion on the IGRA trust; and
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  precedent summary sheet with: trust title, establishment date, amendment dates, and whether the trust meets the requirements in SI 01120.195E in this section. State in the summary the specific reason why the IGRA trust does not meet any requirement.
c.

Alert the submitting RCD, PAS or FO of the review completion and precedent.

IMPORTANT:Do not share copies of trust precedents, RCC opinions, or other materials in the SSITMS SharePoint Repository for Precedents with the public, attorneys, or non-SSA personnel. Only precedents in the PS part of PolicyNet are available to the public.

3. FO makes initial trust resource determination

Use the precedent and certification letter or joinder agreement to make an initial trust resource determination.

a.

Review the certification letter and any other pertinent documents to establish that the individual is a beneficiary of the IGRA trust.

NOTE: It is not necessary to verify that the beneficiary is a tribal member. Only tribal members, or specifically defined groups of members, can be beneficiaries of IGRA trusts.
b.

If the individual presents a joinder agreement (rather than the simpler certification letter), compare it to the IGRA trust precedent to make sure that it contains the same provisions.
c.

If, according to the precedent, the tribe is the grantor of the trust, review the certification letter or joinder agreement based on the requirements in SI 01120.200 and determine if the trust is a resource or not.
d.

If, according to the precedent, the tribe is not the grantor of the trust, review the certification letter or joinder agreement based on the requirements in SI 01120.201 and determine if the trust is a resource or not.
e.
Document the trust resource determination, including whether the tribe is the trust grantor, whether the trust counts as a resource, and any references and rationale used in the decision-making process.
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  For SSI Claims system (i.e., MSSICS) cases, use the Report of Contact page.
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  For non-SSI Claims system cases, use a Report of Contact (SSA-5002) and store it in the electronic folder (EF) or Evidence Portal.
f.

Fax the initial trust resource determination, a copy of the trust, and other pertinent trust documents into the appropriate EF.

4. FO transmits trust resource determination to RTL

Use SSITMS to transmit the trust resource determination to the RTL for review.

a.

On the SSITMS website, select the “Add New Case” tab and input the claimant or recipient’s name, social security number, and any relevant information about the trust.
b.

Indicate in the CS Remarks field any references and rationale used for the determination.
c.

Select “Other” as the trust type.
d.

Submit the trust resource determination to the RTL for review following the instructions on SSITMS.
e.

SSITMS sends an email requesting a review to the RTL and the FO/ADO/RO mailbox. The email subject is “SSI Trust for Review.”

5. RTL reviews FO trust resource determination

The RTL takes the following actions:

a.

Review the FO’s determination, including relevant information in the SSI Claims system and the EF, and determine if you agree with the FO’s determination.
b.

Document in the SSITMS Results field whether you agree or disagree with the FO’s determination; annotate the RTL Remarks field; update the trust status to “Review Completed.”
c.

Click “Update” in SSITMS to notify the FO by email that the RTL review is complete.

6. FO effectuates the trust resource determination

The FO takes the following actions:

a.

Upon receiving the email from SSITMS, access SSITMS to view the results of the RTL’s review.
b.

Select the case from the Summary page listing or use the email link to access the case; click on the “Details/Update” tab. The Results field indicates whether the RTL agreed or disagreed with the FO’s resource determination.
c.

After resolving any issues, change the trust status to “FO Effectuated” to process the case.

NOTE: Select “FO Effectuated” only after completing all case development. Changing the Trust Status to “FO Effectuated” locks the case in SSITMS. Only the Remarks fields is accessible for additional comments.

G. Procedure for IGRA trust amendments

If the tribe makes any substantive amendments to the master trust agreement, the FO must email the amended document to the RTL for referral back to the RCC for an additional review and opinion. The RTL will then update the precedent file in the SSITMS SharePoint Repository for Precedents.

H. Procedure when a claimant appeals the trust resource determination

When a claimant files for a reconsideration of the trust resource determination, FO technicians and RTLs follow these steps.

1. The FO must:

•

Make a trust reconsideration determination.
•

Request a review of the determination in SSITMS by selecting “Recon Pending” from the Recon Trust Status dropdown, annotating the CS Remarks field with the reason for the appeal, and clicking “Submit.”
•

Wait for the email from SSITMS when the RTL reviews your determination; the subject line is “Response to SSI Trust Recon for Review.”
•

Review the RTL’s response; after resolving any issues, effectuate the determination by updating the Recon Trust Status field and clicking “Update.”

NOTE: Goldberg Kelly payments may apply during trust reconsiderations.

2. The RTL must:

•

Receive an email from SSITMS to review an FO reconsideration determination.
•

Review the determination and annotate the RTL Remarks field.
•

Update the Recon Trust Status and Recon Results fields.
•

Click “Update.”

I. References

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SI 01120.200 Information on Trusts, Including Trusts Established Prior to 1/1/00, Trusts Established with the Assets of Third Parties, and Trusts Not Subject to Section 1613(e) of the Social Security Act
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SI 01120.201 Trusts Established with the Assets of an Individual on or after 1/1/00
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SI 01120.202 Development and Documentation of Trusts Established on or after 1/1/00
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SI 01120.204 Notices for Trusts Established on or after 1/1/2000
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SI 04070.010 Title XVI Administrative Finality – Reopening Policies
•

SI 04070.040 Revising SSI Determinations

Social Security

Program Operations Manual System (POMS)

SI 01120.195 Trusts Established under the Indian Gaming Regulatory Act (IGRA) for Minor Children and Legally Incompetent Adults (IGRA Trusts)