NYSARC

Community Trusts

Pooling Benefits

Federal and New York State laws permit a person of any age with a disability (as defined by the Social Security Act) to protect supplemental resources while still remaining eligible for government benefits by using a pooled supplemental needs trust such as those operated by NYSARC.

Here’s a typical situation: A person with a disability and receiving certain governmental benefits receives a lump sum of money. Under the law, that money would have to be spent within a certain amount of time before that person would be eligible again for government benefits.

With a sub-trust account in one of our community trusts, that person can remain eligible for benefits, and still benefit from those resources for life-enhancing needs. Some examples include:

• Entertainment and outings;
• Medical and dental services that are not covered by Medicaid; and
• Other living expenses dependent on the type of benefits.

Our community trusts are pooled 1st-party trusts. A disabled individual can deposit money into a sub-trust account, and our trustees will manage it collectively with all the other trust participants. The trustees will spend it for the sole benefit of the individual beneficiary.

Some caveats we have to point out:

• The sub-trust account may be established by a parent, grandparent, legal guardian, by the disabled individual if he/she has capacity, by an agent for the individual acting under a valid Power of Attorney, or by court order.
• Individuals benefitting from the accounts under the Community Trusts must be disabled as defined in Social Security Law. NYSARC Trust Services does not make this determination.
• The sub-trust account cannot be cancelled by the individual.
• The Trustees have the absolute discretion to grant or deny any distribution due to policy, legal, or other requirements and considerations.
• Some people believe that a conflict of interest may exist in the administration of the trusts because NYSARC Trust Services retains the funds remaining in the beneficiary's account at death.
• Special rules may apply if a sub-trust account is opened while the disabled person is residing in the community, but at some point that person's needs change and he/she needs to be placed into a nursing home.

The Community Trust consists of:

	Trust I	Funded with Assets
	Trust II	Funded with Excess Income
	Trust III	Funded with Assets of $250,000 or more