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Overview

Third-Party Pooled Special Needs Trust (PSNT)

A Third-Party PSNT is established by a parent, relative, or friend of the beneficiary, and can be coordinated with an estate plan, insurance policy, or gift.

By establishing a Third-Party PSNT, Grantors have the peace of mind of knowing that funds will be available for the Beneficiary. 

When planning for a loved one with special needs it is important to give thoughtful consideration to the following:


  • What financial support will my loved one need when I am no longer here?
  • Will my loved one be able to enjoy the same quality of life that they have now?
  • Who will administer the trust and ensure that the funds are managed and used for the benefit of my loved one?
  • How can I ensure that eligibility for Medicaid and Supplemental Security Income (SSI) benefits will not be jeopardized?

Important Definitions

  • Pooled Trust

    Each Beneficiary’s funds are placed in an individual sub-account. The cash assets from all sub-accounts are then “pooled” together, and are invested and managed by True Link Financial Advisors. True Link Financial Advisors is the investment manager to the Trust, not the individual beneficiaries. True Link Financial Advisors does not provide investment advice or services to the individual beneficiaries of the Trust.


    Pooling the funds is intended to reduce administrative fees with the goal of increasing the principal for investment purposes. Account statements are available online and mailed quarterly.

  • Grantor

    The Grantor of a First-Party PSNT can be the Beneficiary with special needs or someone acting on behalf of the Beneficiary such as the parent(s), grandparent(s), the Court or Legal Guardian.


    The funds are the Beneficiary’s own funds from a personal injury award, workers’ compensation claim, Social Security back payment, inheritance, or savings.




  • Beneficiary

    The Beneficiary is someone with special needs for whose benefit the trust was created.




  • Advocate

    The Advocate(s) is an important part of the Beneficiary’s team and works closely with CCT staff. The Advocate(s) is authorized to make disbursement requests by signing and submitting the Payment Request Form to CCT and may receive confidential financial information about the Beneficiary’s sub-Account.


    The Advocate(s) is usually named by the Grantor(s) on the CCT Joinder Agreement (the legal document to join the trust), and may be the Beneficiary, a Guardian, Conservator, Power of Attorney, family member, case worker, friend, and/or someone who is trusted and familiar with the needs of the Beneficiary.


    However, CCT has sole discretion to decide what distributions are in the Beneficiary’s best interest and permitted under the terms of the trust, as well as when to share information.




  • Remainder Beneficiary

    For a Beneficiary who never received Medicaid benefits:


    After the customary CCT administrative fees, Capital First Trustee fees and True Link Financial Advisors, LLC, investment management fees are disbursed the remaining funds are distributed as designated in the Joinder Agreement, the legal document to join. The Grantor can designate Primary and Contingent Successor Beneficiaries who will receive the funds. The Grantor can designate one person, several people, or a nonprofit organization like CCT to receive some or all of the remainder funds. The named remainder beneficiaries cannot be changed.


    Please see Section 8 in the First-Party Pooled Special Needs Trust Joinder Agreement on“Distributions Upon the Death of the Beneficiary” for further details.


    For a Beneficiary who received Medicaid benefits:


    The First-Party Pooled Special Needs Trust is a Medicaid payback trust for Beneficiaries who receive Medicaid. Upon the death of the Beneficiary, there are specific rules for what happens to the remainder. These rules vary from state to state. In general, the Medicaid office for each state in which the Beneficiary received Medicaid benefits is notified and CCT requests information detailing the total amount that Medicaid has paid on behalf of the beneficiary for medical expenses.


    CCT’s policy is followed to the extent that it complies with each state’s Medicaid Policy.


    1. When Medicaid is owed less than the amount remaining in the trust:


    Example – If there is $50,000 remaining in the trust and Medicaid is owed $25,000, the Successor Beneficiary(ies) per the Joinder Agreement will receive the balance after Medicaid is reimbursed and administrative fees are deducted.


    2. When Medicaid is owed more than the amount remaining in the trust:


    Example – If there is $50,000 remaining and Medicaid is owed $60,000, the remainder will be retained by CCT to support its mission to serve people with special needs if allowed by the state’s Medicaid policy.


    IMPORTANT: Pre-need funeral and burial arrangements for the Beneficiary should be made and paid for in advance, as disbursements cannot be approved once the Beneficiary has passed away.It is important that CCT is notified by the Grantor or Advocate at the time of death of the Beneficiary. CCT is not notified by any other agency. A copy of the death certificate is requested when it becomes available.




Additional Definitions

Funding the Trust

The most common way trusts are funded is through the Grantor’s will, estate plan, life insurance policy, or employee benefit. The trust can also be funded by a gift, bequest, or inheritance. CCT accepts cash assets for deposit into the trust; no real estate or non-cash assets are accepted. Once funded, the trust is irrevocable.

Once the Grantor completes the Joinder Agreement and other forms, the trust is set up and waiting to be funded. There is no expectation that the account be funded immediately. The account is available to receive funds (cash/check) from any source and at any time. When appropriate it is helpful to notify family members and others about the Beneficiary’s special needs trust account and that funds be directed to the special needs trust with CCT and not given or left directly to the individual (see sample letter).

How Funds in the Trust Can Be Used

The funds can be used to pay for expenses that will enhance the quality of life for the Beneficiary.

Disbursements can be requested from the trust by a Primary or Secondary Advocate.

Bills are paid by check to vendors or reimbursed to the Advocate or in certain circumstances a credit card is made available and funded by the Beneficiary’s trust account.

For more information, see our Disbursement Information Manual.

Disbursement Information Manual

  • Disbursement requests are reviewed and approved based on the following criteria:

    • Whether eligibility for benefits such as SSI and Medicaid would be jeopardized
    • Whether the request is for the sole benefit of the Beneficiary
    • Whether the request is prudent

  • Examples include, but are not limited to:

    • Medical and Dental Services not covered by insurance
    • Assistive Technology
    • Eyeglasses, Hearing Aids, and Prosthetic Devices
    • Pre-paid Burial Expenses
    • Computer and Internet Services
    • Education Expenses
    • Caregiver Expenses
    • Home Modifications
    • Clothing and Furniture

Are you ready to set up a trust?

Visit the Process of Joining for detailed steps in setting up a pooled trust with CCT.

Process of Joining
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