Can the parent of a person with special needs, who is also that person's guardian, serve as the trustee of a special needs trust that will hold a settlement?
In most states, there is no prohibition on a parent/legal guardian serving as trustee of a special needs trust. However, some states require that such a trustee be bonded. In order to qualify for a bond (an insurance policy that refunds money to the trust if the trustee steals the funds), the trustee must have excellent credit. Because of this requirement, many parents may not qualify for a bond. Depending on the amount of assets to be placed into the trust, a professional experienced in managing special needs trusts might be a better trustee. For more information about selecting a professional trustee, click here and here.
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In most states, there is no prohibition on a parent/legal guardian serving as trustee of a special needs trust. However, some states require that such a trustee be bonded. In order to qualify for a bond (an insurance policy that refunds money to the trust if the trustee steals the funds), the trustee must have excellent credit. Because of this requirement, many parents may not qualify for a bond. Depending on the amount of assets to be placed into the trust, a professional experienced in managing special needs trusts might be a better trustee. For more information about selecting a professional trustee, click here and here.
Article Last Modified: 09/29/2015© 2018 ElderLawNet, Inc.
ASNP is a nationwide network of attorneys and financial planners who provide special needs planning services to families and organizations that serve people with disabilities.
© 2018 ElderLawNet, Inc.
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