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What to Do When Special Needs Trust Administration Beneficiaries Are Unhappy

Special Needs Trust (noun):

A Trust established for the benefit of a person with a disability. This type of Trust must meet Social Security regulations and are not counted in determining eligibility for Supplemental Security Income or Medicaid.

What to Do When Special Needs Trust Administration Beneficiaries Are Unhappy:

When a person with disabilities has assets of his own or has someone who wants to give him money for his care, this can become a problem with regard to eligibility for certain governmental benefits. To get around this issue, many people choose to set up a special needs trust to benefit the person with special needs while maintaining their ability to continue qualifying for much-needed government assistance. Unfortunately, however, this benefit is not without cost. For the trust to work, the beneficiary must give up control over the assets and allow the trustee to spend the trust assets as he or she sees fit.

5 Options for Dealing With Trustee/Beneficiary Conflict During Special Needs Trust Administration

While the trustee has discretion over how the money in the trust is used, it still must be spent for the benefit of the person with special needs. Unfortunately, some beneficiaries feel that they have lost control over the assets and as a result, tension may arise. The following are five potential options for dealing with dipsutes during the special needs trust administration process:

  1. Consider setting up a meeting, with your attorney present, where the beneficiary can air his grievances. If the beneficiary feels as though he is being heard, this may help to resolve some of the conflict.
  2. Have the attorney assisting you with the trust administration go over the trust in detail with the beneficiary. Explaining how special needs trusts work and why it is so important for a trustee to be in charge of the assets may help the beneficiary understand that you are not trying to be controlling but simply must follow the trust guidelines in order to prevent the beneficiary from losing certain government benefits.
  3. Remember that communication is key. Failing to communicate frequently and fully is a great way to cause potential issues of mistrust and feelings of frustration.
  4. If the trust language allows for it, consider appointing a co-trustee that has a good relationship with the beneficiary. Sometimes, the addition of another person can serve as a strong buffer and help to ease the tension that may exist between you and the beneficiary.
  5. Again, if the trust language allows for it, consider using a trust protector. A trust protector is a person who is appointed to watch over a trust. This includes helping to resolve disputes that may arise between trustees and beneficiaries.

Contact us Today:

As the trustee of a special needs trust, you have several duties and responsibilities. This includes working hard to avoid conflict and resolve disputes that may arise. We encourage you to contact us today at (888) 443-6590 for more information.

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Scott Grossman

Scott Grossman


The Grossman Law Firm, APC · 525 B Street, Suite 1500, San Diego, CA 92101 · (951) 523-8307

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