11.7
Special Needs Trust

 
 
 
 

IRREVOCABLE SPECIAL NEEDS TRUST
FOR THE BENEFIT OF LISA DUNN

 
 

This Agreement, made this day of , 20 by Pamela Dunn (hereinafter called "Settlor"), Guardian of the Estate of Lisa Dunn, an Incapacitated Person (hereinafter called "Beneficiary") and ABC Bank (hereinafter called "Trustee").

 

The Trustee shall ascertain whether there are any claims or liens by the Department of Public Welfare and the Social Security Administration before payment into the trust. A copy of the Special Needs Trust should be directed to:

 
 

The Special Needs Trust Depository
Attention: Manager, TPL Section
P.O. Box 8486
Harrisburg PA 17105-8486

   
 

SSI Program Support Team
Attention: Team Leader
Mid Atlantic Program Service Center
3rd and Spring Garden Streets
Philadelphia PA 19101

 

After payment of any claims or liens, if any, the Settlor is authorized, subject to Court approval, to transfer, assign and convey unto the Trustee, the property listed in Schedule "A" annexed hereto and made a part hereof, and the Trustee agrees to hold such property, together with any other property, real or personal, that may be added to this Trust after obtaining approval from the Orphans' Court Division of the Court of Common Pleas of Philadelphia County. No public assistance or social security benefits for the Beneficiary shall be added to the Trust and no additions shall be accepted by the Trustee after the Beneficiary attains the age of sixty-five (65) years, such proceeds and additions being hereinafter call principal in trust, upon the following terms and conditions:

 
 
 

Note: Because Special Needs Trusts under 42 U.S.C. 1396p(d)(4)(A) have only been in existence since 1993, and because Pa.R.C.P. 2039 and 2064 have only allowed the creation of Special Needs Trusts since 1997, the substantive and procedural requirements for approval in the Orphans' Court Division in Philadelphia are still evolving at the time this book goes to print. This "form trust" (to the extent that there can be a "form trust"), although currently an approved form for the Philadelphia Orphans' Court Division, may not be appropriate in many cases. The terms should be carefully analyzed and modified as appropriate under the circumstances.

 

FIRST: Lisa Dunn is a disabled individual, born July 1, 1967. She shall be the primary Beneficiary of this Trust.

 

SECOND: Settlor declares this Trust to be a Special Needs Trust pursuant to 42 U.S.C. 1396p(d)(4)(a) and shall be for the sole benefit of the Beneficiary. The purpose of the Special Needs Trust shall be to maintain and support the Beneficiary's health, safety, welfare, education and treatment when such items, products or services are not provided by a public agency or government program.

 
A.

Special needs shall mean those requisite items, products or services that can be provided to the beneficiary to assist in the treatment of the Beneficiary's disability and increase her quality of life.

   
  B.

Special needs shall include but not be limited to medical expenses, dental expenses, nursing and custodial care, psychiatric/psychological services, recreational therapy, occupational therapy, physical therapy, vocational therapy, durable medical needs, prosthetic devices, special rehabilitative services or equipment, programs of training, education, transportation and required travel expenses, dietary needs and supplements, and related insurance.

 

THIRD: Trustee shall seek support and maintenance of the Beneficiary from all available public resources, including (but not limited to) supplemental security income program (SSI), old age survivor and disability program (OASD), the Medicare program and Medical Assistance program or similar or successor programs. Trustee shall take into consideration applicable resources and income limitations of any of those public programs or private agencies for which the Beneficiary is eligible in determining whether to make any discretionary distributions hereunder. Payments or distributions from this Trust which will result in the loss of governmental or other benefits to which the Beneficiary is or may be entitled are expressly forbidden. The Trustee should provide the Special Needs Trust Depository with annual statements.

 

FOURTH: Trustee shall have the power AFTER OBTAINING APPROVAL from the Orphans' Court Division of the Court of Common Pleas of Philadelphia County, following due notice to all interested parties, including the Department of Public Welfare and Social Security Administration, to distribute to or apply for the benefit of the Beneficiary, such amount of income and/or principal (including accumulated income) as Trustee may from time to time determine to be necessary or appropriate for her special needs and comfort. Expenditures from the Trust fund must have a reasonable relationship to the disability of the Beneficiary. Any income not so distributed or applied shall be added to principal. Notice to the Department of Public Welfare and Social Security Administration should be directed to:

 
 

The Special Needs Trust Depository
Attention: Manager, TPL Section
P.O. Box 8486
Harrisburg PA 17105-8486

   
 

SSI Program Support Team
Attention: Team Leader
Mid Atlantic Program Service Center
3rd and Spring Garden Streets
Philadelphia PA 19101

 

FIFTH: It is further the intent of this Trust that no part of the Trust established hereunder shall be used to supplant or replace public assistance benefits of any county, state, federal or governmental agency. For these purposes, in determining the Beneficiary's eligibility for such benefits, no part of the principal or income of the Trust established hereunder shall be considered available to the Beneficiary. In the event the Trustee is requested by any department or agency to release principal or income of the Trust established hereunder, to or on behalf of the Beneficiary, to pay for equipment, medication or services that other organizations or agencies are authorized to provide, or in the event the Trustee is requested by any department or agency administering such benefits to release the Trust principal or income for this purpose or in the event that any department or agency administering such benefits petitions the Court of competent jurisdiction for these same purposes, the Trustee shall deny such request and is directed to defend and contest, at the expense of the Trust established hereunder. Trustee shall have complete discretion with regard to any such claims, including management of all litigation which may result. Trustee shall also be authorized in its sole and absolute discretion, to settle, in whole or in part, or otherwise compromise any such claim or litigation.

 

SIXTH: If the Trustee determines that it is impractical to administer the Trust held under this irrevocable Trust because it is or becomes too small to justify maintaining as a Trust, or because it is no longer suitable for the Beneficiary's needs, the Trustee shall obtain Court approval to terminate this Trust and to distribute the principal and income of the Trust.

 

SEVENTH: This Trust shall terminate upon the earlier of the death of the Beneficiary or Order of Court upon petition thereto, or the termination of the Guardianship of the Beneficiary through an Adjudication and Order of Distribution.

 
A.

Upon termination of the Trust during the lifetime of the Beneficiary, Trustee shall obtain a determination from the Department of Public Welfare of its claim, if any, for Medical Assistance payments which it has made on behalf of the Beneficiary. Trustee shall distribute to the department of Public Welfare from the remaining principal and accumulated income, if any, an amount equal to the amount of Medical Assistance [Medicaid] paid on behalf of the Beneficiary during the time the Trust was in existence. If more than one state is entitled to reimbursement for Medicaid expenditures, each state shall receive its proportionate share of the total amount of Medicaid to be reimbursed. If any principal and accumulated income remains after distribution to the Department of Public Welfare, Trustee shall distribute the remainder in accordance with an Order of Court terminating the Trust upon petition thereto, or in accordance with the termination of the Guardianship of the Beneficiary through an Adjudication and Order of Distribution.

   
  B.

Upon the termination of the Trust at the death of the Beneficiary, Trustee shall obtain a determination from the Department of Public Welfare of its claim, if any, for Medical Assistance payments which it has made on behalf of the Beneficiary. Trustee shall distribute to the Department of Public Welfare from the remaining principal and accumulated income, if any, an amount equal to the amount of Medical Assistance [Medicaid] paid on behalf of the Beneficiary during the time the Trust was in existence. If more than one state is entitled to reimbursement for Medicaid expenditures, each state shall receive its proportionate share of the total amount of Medicaid to be reimbursed. If any principal and accumulated income remains after distribution to the Department of Public Welfare, Trustee shall distribute the remainder to the personal representative of the Beneficiary's estate.

 

EIGHTH: The interest of the Beneficiary in both the principal and income, until actually distributed, shall not be subject to anticipation or to voluntary or involuntary alienation.

 

NINTH: Trustee shall, in addition to the powers given by law, have the following powers applicable to all property held in trust whether principal or income, and exercisable without Order of Court:

 
A.

To retain any property transferred to this Trust, and to make such investments, and reinvestments and in such proportions, without limitation to what are known as legal investments, as the Trustee shall consider beneficial.

 
  B.

To (1) participate in any merger or reorganization affecting securities held hereunder at any time, (2) deposit stock under voting agreements, (3) exercise any option to subscribe for stocks, bonds or debentures, (4) grant proxies, discretionary or otherwise, to vote shares of stock.

     
  C.

To manage, operate, repair, alter or improve real estate or other property and to lease real estate and other property upon such terms and for such period as Trustee deems advisable.

     
  D.

To buy or sell (and to grant options for the sale of) any real or personal property at public or private sale for such prices and upon such terms as Trustee may think proper after obtaining approval from the Orphans' Court Division of the Court of Common Pleas of Philadelphia County, following due notice to all interested parties, including the Department of Public Welfare and Social Security Administration, without liability on the purchaser to see to the application of the purchase monies.

 
 

ELEVENTH: If the Trustee shall resign or for any reason cease or become unable to act as Trustee hereunder before termination of this Trust, a successor shall be appointed by the Orphans' Court Division of the Court of Common Pleas of Philadelphia County. Although an accounting shall not be required by the Court, the Trustee shall be required to file with the Clerk of the Orphans' Court Division of the Court of Common Pleas of Philadelphia County, following due notice to all interested parties, including the Department of Public Welfare and Social Security Administration, a Petition for Discharge as Trustee, appending thereto a status report summarizing all transactions.

 

TWELFTH: The situs of this Trust shall be the Commonwealth of Pennsylvania and all questions as to the validity or effect of this instrument or the administration of the Trust hereunder shall be governed by the law of Pennsylvania.

 

THIRTEENTH: The Trustee hereby accepts the Trust created by this Agreement and agrees to carry out the provisions hereof on its part according to the best of its ability.

 

In Witness Whereof, the Estate of Lisa Dunn, an Incapacitated Person, by and through Pamela Dunn, as Guardian of the Estate, Settlor herein, and ABC Bank, as Trustee herein have set their hands and seals the month, day and year first above written.

 
 
   

ABC Bank, N.A.
Trustee

 
   
   
   
Witness By:
   
   
   
   
Witness

Pamela Dunn
Guardian of the Estate of Lisa Dunn, an
Incapacitated Person

 
 
 

 
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