When setting up a trust for a loved one with special needs, you’ll also choose a trustee, which might be yourself, or a friend, relative or professional. No matter who you choose, it’s important to understand the responsibilities of the trustee.
Appointing a Trustee for a Special Needs Trust
If you have a loved one or friend with a disability, you are probably taking extra care to ensure their needs are met, during—and ideally even beyond your lifetime. Establishing a trust—and appointing a trustee—can be an important way to do that. The trustee you appoint to manage the trust will have a legal duty to put the needs of the beneficiary first—always. That’s why trustees are considered fiduciaries and can be asked to obtain a type of fiduciary bond, known as a trustee bond. It’s quick and easy to obtain a trustee bond at leading, national provider: Colonial Surety Company.
Do’s and Don’ts for Trustees
The trustee of a special needs trust must be able to work collaboratively with other professionals and people involved with the beneficiary. For example, if there is an appointed guardian or conservator, efforts to meet the needs of the beneficiary must be coordinated. The trustee must also keep the beneficiary and others, such as family, informed of trust activity. Accurate records and reports, including reports related to social security and medicaid benefits the beneficiary receives are also duties of the trustee.
Experts at NOLO offer these additional do’s and don’ts for special needs trustees:
- Avoid any activity that conflicts with the purpose of the trust—which is to enhance the quality of life of the beneficiary.
- Spend money to enhance the beneficiary’s life, while making the trust funds last as long as possible.
- Respond to the beneficiary’s personal needs for goods and services that aren’t covered by SSI or Medicaid.
- Keep up with SSI and Medicaid income and resource rules so that the trustee’s spending doesn’t affect the beneficiary’s eligibility for SSI and Medicaid.
- Invest and manage trust property following the terms of the trust and state law, in the beneficiary’s best interests.
Understanding Trustee Bonds
The written trust agreement generally includes details about how the trustee is to manage and distribute the assets, and other essential duties to be carried out. Given the fiduciary responsibilities undertaken by trustees, the trust agreement may require to procurement of a trustee bond. In some circumstances, courts can also require a trustee bond.
Since they guarantee the faithful performance of trustees in accordance with the law, trustee bonds can be confidence boosting for everyone involved. As a leading national provider of many types of fiduciary bonds, Colonial Surety Company makes it easy and efficient to obtain a trustee bond. Just get a quote online, fill out the information, and enter a payment method. Print or e-file the bond from anywhere. It’s that simple.
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