For the purposes of these regulations, the following definitions apply.
Annuity: A right to receive periodic payments, either for life or a term of years.
Beneficiary: Any individual, or individuals, designated in the trust to receive any disbursal from the corpus of the trust, or from income generated by the trust, which benefits the party receiving it. A payment from a trust may include actual cash, as well as non-cash or property disbursements, such as the right to use and occupy real property.
Grantor: Any individual who creates a trust. It includes the following:
1. The client;
2. The client’s spouse;
3. A person, including a court or administrative body, with legal authority to act in place of, or on behalf of, the individual or the individual’s spouse (guardian/conservator); or
4. A person, including a court or administrative body, acting at the direction or upon the request of the client or the client’s spouse.
Irrevocable Trust: A trust which cannot, in any way, be revoked by the grantor.
Medicaid-Qualifying Trust: A trust or similar legal device that was established before August 11, 1993, by a client (or his or her spouse) under which:
1. The client is the beneficiary of all or part of the payments from the trust; and
2. The amount of the distribution is determined by one or more trustees who are permitted to exercise any discretion with respect to the amount to be distributed to the individual and the distributable amount from a Medicaid-qualifying trust has no use limitation.
Pooled Trust: A trust containing the assets of a disabled individual(s) that is established and managed by a nonprofit association in a separate account solely for the benefit of a disabled individual.
Revocable Trust: A trust which can be revoked by the grantor. A trust which provides that the trust can only be modified or terminated by a court is considered to be a revocable trust, since the grantor (or representative) can petition the court to terminate the trust. A trust called irrevocable but which will terminate if some action is taken by the grantor is a revocable trust for purposes of these regulations.
For example, a trust may require a trustee to terminate a trust and disburse the funds to the grantor if the grantor leaves a nursing facility and returns home. Such a trust would be considered revocable.
Special Needs Trust: A trust containing the assets of a client age 64 or younger who is disabled and which is established for the sole benefit of the client by a parent, grandparent, legal guardian, or a court.
Testamentary Trust: A trust established through a will.
Trust: For purposes of these regulations, a trust is any arrangement in which an individual (grantor) transfers property to another person(s) (trustee[s]) with the intention that it be held, managed, or administered by the trustee(s) for the benefit of the grantor or certain designated beneficiaries. The trust must be valid under state law and manifested by a valid trust instrument of agreement. A trustee holds a fiduciary responsibility to manage the trust’s corpus and income for the benefit of the beneficiaries. The term trust also includes any legal instrument or device that is similar to a trust for purposes of these regulations. It involves a grantor who transfers property to an individual or entity with the intention that it be held, managed, or administered by the individual or entity for the benefit of the grantor or others. This can include (but is not limited to) escrow accounts, investment accounts, pension funds, irrevocable burial trusts, annuities, and other similar entities managed by an individual or entity with fiduciary obligations.
{6/18/2001}