CALIFORNIA SPECIAL NEEDS TRUST AGREEMENT

(Third-Party Supplemental Needs Trust — No Medicaid Payback Required)

TABLE OF CONTENTS

Article I — Parties, Recitals, and Effective Date
Article II — Definitions
Article III — Irrevocable Trust Creation and Funding
Article IV — Distributions During the Beneficiary's Lifetime — Supplement, Not Supplant
Article V — SSI / Medi-Cal Eligibility Preservation and Trustee Duties
Article VI — ABLE Account Coordination
Article VII — Spendthrift Provisions
Article VIII — Termination and Remainder Distributions
Article IX — Trust Protector (CUDTA)
Article X — Trustee Provisions — Succession, Compensation, and Powers
Article XI — Digital Assets (RUFADAA)
Article XII — OPTIONAL: First-Party / Self-Settled (d)(4)(A) Provisions and Medi-Cal Payback
Article XIII — Perpetuities Savings Clause
Article XIV — General Provisions
Article XV — Execution and Notary Acknowledgment
Schedule A — Initial Trust Property
Schedule B — Remainder Beneficiaries

ARTICLE I — PARTIES, RECITALS, AND EFFECTIVE DATE

1.1 Title. This instrument creates the [________________________________] Special Needs Trust (the "Trust").

1.2 Effective Date. This Trust Agreement is executed and effective as of [__/__/____] (the "Effective Date").

1.3 Parties.

(a) Settlor/Grantor: [________________________________] ("Grantor"), residing at [________________________________].

(b) Initial Trustee: [________________________________] ("Trustee"), residing or with offices at [________________________________].

(c) Beneficiary: [________________________________] ("Beneficiary"), date of birth [__/__/____].

(d) Trust Protector (if appointed at execution): [________________________________] ("Trust Protector"). See Article IX.

1.4 Recitals.

WHEREAS:

(a) The Beneficiary is a person with a disability as defined in 42 U.S.C. § 1382c(a)(3) and is currently eligible for, or may in the future become eligible for, means-tested government benefits including but not limited to Supplemental Security Income ("SSI") and California Medi-Cal ("Government Benefits");

(b) The Grantor desires to set aside property for the Beneficiary's supplemental needs without disqualifying the Beneficiary from Government Benefits;

(c) This Trust is funded exclusively with the Grantor's own assets and constitutes a third-party special needs trust that is NOT subject to the Medicaid payback requirements of 42 U.S.C. § 1396p(d)(4)(A);

(d) The Grantor intends this Trust to be irrevocable upon execution and to be administered as a purely discretionary supplemental needs trust;

(e) The Trustee is willing to accept and administer the Trust Estate under the terms of this Agreement;

NOW, THEREFORE, in consideration of the mutual undertakings herein, the Grantor establishes this Trust and the Trustee accepts it upon the following terms.

1.5 Governing Law and Jurisdiction. This Trust is created under, and shall in all respects be governed by, the laws of the State of California, including the California Probate Code and the California Welfare and Institutions Code, without regard to conflict-of-laws principles. The Superior Court of the County of [________________________________], California (the "Probate Court") shall have exclusive jurisdiction over any matter arising under this Trust.

ARTICLE II — DEFINITIONS

The following capitalized terms have the meanings ascribed below. Defined terms apply equally in singular and plural forms.

"ABLE Account" — A qualified tax-advantaged savings account established under the Achieving a Better Life Experience Act, 26 U.S.C. § 529A, and California's CalABLE program, Cal. Gov. Code §§ 4875–4885.

"Beneficiary's Lifetime" — The period commencing on the Effective Date and ending on the date of the Beneficiary's death.

"Benefits Counsel" — An attorney admitted to practice in California with demonstrated expertise in public benefits law, including SSI, Medi-Cal, and special needs trust administration.

"Digital Assets" — Electronic records in which the Beneficiary or the Trust holds a right or interest, as defined in Cal. Prob. Code § 870(b), including but not limited to email accounts, social media accounts, digital photographs and media, domain names, cryptocurrency, software licenses, and loyalty program accounts.

"Distribution Guidelines" — The standards set forth in Article IV governing permissible and prohibited trust distributions.

"Government Benefits" — Any present or future federal, state, county, or local means-tested public assistance program for which the Beneficiary may be eligible, including but not limited to Supplemental Security Income ("SSI"), Social Security Disability Insurance ("SSDI") to the extent it incorporates means-tested components, California Medi-Cal, Medicaid, Section 8 housing assistance, Supplemental Nutrition Assistance Program ("SNAP" / CalFresh), In-Home Supportive Services ("IHSS"), and regional center services under the Lanterman Developmental Disabilities Services Act.

"In-Kind Support and Maintenance" or "ISM" — Food or shelter (including room, mortgage, real property taxes, heating fuel, gas, electricity, water, sewage, and garbage collection) provided to the Beneficiary, valued under the Presumed Maximum Value ("PMV") rule per SSA POMS SI 00835.300 et seq.

"Presumed Maximum Value" or "PMV" — The value assigned to ISM, equal to one-third of the applicable Federal Benefit Rate ("FBR") plus the general income exclusion ($20), as set forth in SSA POMS SI 00835.300. For 2026, the PMV is $351.33 per month (subject to annual adjustment).

"Qualified Disability Expenditure" — Any expenditure related to the Beneficiary's disability that enhances the Beneficiary's quality of life, health, independence, or productivity, as described in 26 U.S.C. § 529A(e)(5).

"Special Needs" or "Supplemental Needs" — Those needs of the Beneficiary not being met, and not reasonably expected to be met, by Government Benefits, including but not limited to the categories listed in Section 4.3.

"Trust Estate" — All property held under this Trust at any time, including the initial funding described in Schedule A, all subsequent additions, and all income, appreciation, and proceeds thereof.

ARTICLE III — IRREVOCABLE TRUST CREATION AND FUNDING

3.1 Creation. The Grantor hereby creates this irrevocable supplemental needs trust and transfers to the Trustee the property described in Schedule A (the initial Trust Estate). The Trustee accepts the Trust Estate and agrees to hold, administer, invest, and distribute it in accordance with this Agreement.

3.2 Irrevocability. This Trust is irrevocable as of the Effective Date. The Grantor retains no power to alter, amend, revoke, or terminate this Trust, except as expressly provided in Section 14.2 (limited administrative amendments). The Grantor retains no beneficial interest in the Trust Estate.

3.3 Additional Contributions. Any person other than the Beneficiary may transfer additional property to the Trust during the Grantor's lifetime or by testamentary disposition (including life insurance proceeds, retirement account benefits, or bequests), provided the Trustee consents to accept such property. All additions shall be administered under the terms of this Agreement.

3.4 No Obligation to Fund. The Grantor is under no obligation to make additional contributions. The Grantor's creditors shall have no claim against the Trust Estate. The Trust Estate shall not be subject to the claims of the Grantor's creditors.

3.5 Tax Classification. Unless otherwise elected by the Trustee upon advice of tax counsel, the Trust shall be classified as a complex trust for federal and California income tax purposes. The Trustee shall obtain and maintain a separate federal Employer Identification Number for the Trust.

ARTICLE IV — DISTRIBUTIONS DURING THE BENEFICIARY'S LIFETIME — SUPPLEMENT, NOT SUPPLANT

4.1 Sole and Absolute Discretion. The Trustee may, but shall never be required to, distribute so much of the net income and principal of the Trust Estate as the Trustee, in the Trustee's sole and absolute discretion, determines is advisable for the Beneficiary's Supplemental Needs, subject to the Distribution Guidelines set forth in this Article IV and the eligibility-preservation duties set forth in Article V.

4.2 Mandatory Standard: Supplement, Not Supplant.

(a) All distributions from this Trust shall be made solely to SUPPLEMENT, and NOT to SUPPLANT, REPLACE, DIMINISH, or SUBSTITUTE FOR, any Government Benefits for which the Beneficiary is eligible or may become eligible. This is the overriding directive of this Trust and shall govern all discretionary decisions.

(b) No distribution shall be made if such distribution would result in the reduction, suspension, or termination of the Beneficiary's Government Benefits, unless the Trustee determines, after consulting with Benefits Counsel, that the benefit to the Beneficiary of making the distribution clearly outweighs the loss or reduction of Government Benefits.

(c) If any provision of this Trust is inconsistent with the Beneficiary's continued eligibility for Government Benefits, the provision shall be interpreted, or if necessary reformed by the Probate Court, in the manner most consistent with maintaining the Beneficiary's eligibility.

4.3 Permissible Distributions. Subject to the overriding standard in Section 4.2, the Trustee may make distributions for the following categories of Supplemental Needs (this list is illustrative, not exhaustive):

☐ Education and vocational training (tuition, books, supplies, tutoring, special education services, college or vocational programs)
☐ Recreation, entertainment, and cultural enrichment (travel, vacations, concerts, museum memberships, sporting events, hobbies, camp programs)
☐ Medical, dental, and therapeutic care not covered by Medi-Cal or other Government Benefits (experimental treatments, out-of-network providers, elective dental care, vision care, mental health services, alternative therapies)
☐ Durable medical equipment, assistive technology, and adaptive devices not covered by Government Benefits (power wheelchairs, hearing aids, communication devices, prosthetics, vehicle modifications)
☐ Personal care attendants, companions, and life skills aides (to the extent not provided by IHSS or other programs)
☐ Transportation (vehicle purchase, modification, insurance, maintenance, fuel, ride-sharing services, public transit passes)
☐ Technology (computers, tablets, smartphones, software, internet service, assistive technology)
☐ Legal services (guardianship or conservatorship proceedings, benefits appeals, trust-related litigation)
☐ Clothing, personal items, and grooming
☐ Telephone and communication expenses
☐ Insurance premiums (supplemental health insurance, dental insurance, renter's insurance, umbrella liability)
☐ Pre-paid burial and funeral expenses (irrevocable burial fund up to applicable limits)
☐ Pet care and service animal expenses
☐ Social activities, religious or spiritual activities, and community participation
☐ Professional services (financial planning, tax preparation, care management)
☐ Home furnishings, appliances, and household goods (for the Beneficiary's residence)
☐ Contributions to the Beneficiary's ABLE Account (see Article VI)

4.4 Prohibited Distributions and ISM Considerations.

(a) Food and Shelter. The Trustee shall NOT make distributions for the Beneficiary's food or shelter (including rent, mortgage payments, real property taxes, homeowner's insurance, heating fuel, gas, electricity, water, sewage, and garbage collection) unless the Trustee first determines, after consulting with Benefits Counsel, that:

(i) The distribution is in the Beneficiary's best interest; AND

(ii) The Trustee has evaluated the ISM consequences under SSA POMS SI 00835.300 et seq. and has concluded that the value of the food or shelter benefit to the Beneficiary exceeds the resulting reduction in SSI benefits under the PMV rule.

(b) Cash Distributions. The Trustee shall NOT make cash distributions directly to the Beneficiary. Cash in the Beneficiary's hands is a countable resource for SSI purposes and may jeopardize Government Benefits.

(c) Gifts to Others. Trust funds shall not be used to make gifts from the Beneficiary to any other person.

(d) No Distributions for Debts. The Trustee shall not pay the legally enforceable debts of the Beneficiary if doing so would constitute a distribution "to or for the benefit of" the Beneficiary that could be counted as income or a resource under SSI rules.

4.5 Mandatory Direct Payment to Third-Party Providers. All distributions shall be made by direct payment to third-party providers of goods and services — never to the Beneficiary personally. The Trustee shall pay vendors, service providers, landlords, educational institutions, medical providers, and other third parties directly. If a vendor requires advance payment, the Trustee shall issue payment directly to the vendor.

4.6 Accumulation of Income. The Trustee may accumulate income within the Trust without distributing it. There shall be no requirement to distribute income currently, and accumulated income shall be added to principal.

4.7 Emergency Authority. Notwithstanding any other provision of this Article, if the Beneficiary's life, health, or safety is in immediate jeopardy, the Trustee may make emergency distributions without prior consultation with Benefits Counsel, provided the Trustee: (a) documents the emergency circumstances; (b) consults Benefits Counsel as soon as reasonably practicable after the emergency distribution; and (c) takes all available steps to mitigate any adverse impact on Government Benefits.

ARTICLE V — SSI / MEDI-CAL ELIGIBILITY PRESERVATION AND TRUSTEE DUTIES

5.1 Primary Duty. The Trustee's paramount duty, in addition to all fiduciary duties imposed by California law, is to administer the Trust in a manner that preserves the Beneficiary's eligibility for Government Benefits to the greatest extent possible while enhancing the Beneficiary's quality of life.

5.2 Annual Benefits Verification. The Trustee shall, at least annually:

(a) Verify the Beneficiary's current SSI eligibility status and benefit amount by contacting the Social Security Administration ("SSA") or reviewing current benefit correspondence;

(b) Verify the Beneficiary's current Medi-Cal eligibility status and program type (including whether the Beneficiary receives Aged and Disabled Federal Poverty Level Medi-Cal, SSI-linked Medi-Cal, Section 1619(b) Medi-Cal, or another category) by contacting the California Department of Health Care Services ("DHCS") or the county human services agency;

(c) Verify the status of any other Government Benefits the Beneficiary receives (IHSS, regional center services, Section 8, CalFresh);

(d) Document the results of all verifications in the Trust's records.

5.3 Current SSI Resource Limits. As of the date of this Trust, the SSI resource limit is $2,000 for an individual and $3,000 for a married couple (20 C.F.R. § 416.1205). These limits have not been adjusted since 1989. The Trustee shall monitor for any legislative changes to these limits and adjust administration accordingly.

5.4 SSI Federal Benefit Rate. For 2026, the SSI Federal Benefit Rate ("FBR") is $994 per month for an eligible individual and $1,491 per month for an eligible couple. California supplements these amounts through the State Supplementary Payment ("SSP"). The Trustee shall monitor the current FBR and SSP amounts each calendar year.

5.5 Duty to Retain Benefits Counsel. The Trustee shall retain Benefits Counsel to advise on the impact of distributions and other trust-related transactions on the Beneficiary's Government Benefits. The costs of Benefits Counsel shall be paid from the Trust Estate. The Trustee shall consult Benefits Counsel:

(a) Before making any distribution that involves food, shelter, or potential ISM consequences;

(b) Before making any distribution exceeding $[________________________________] in a single transaction or $[________________________________] in any calendar quarter;

(c) Whenever the Beneficiary's benefits status changes (approval, denial, suspension, reduction, or termination);

(d) At least annually in connection with the verification duties under Section 5.2;

(e) Before any early termination or modification of the Trust.

5.6 Documentation Requirements. The Trustee shall maintain detailed records of:

(a) Every distribution, including date, amount, recipient/payee, purpose, and the category of Supplemental Need addressed;

(b) All benefits verifications under Section 5.2;

(c) All consultations with Benefits Counsel, including written summaries of advice received;

(d) All SSA, DHCS, and county correspondence;

(e) Copies of all benefits award letters, suspension notices, and redetermination forms.

5.7 Liability for Benefit-Disqualifying Distributions. If the Trustee makes a distribution that causes or contributes to the reduction, suspension, or termination of the Beneficiary's Government Benefits, and the Trustee failed to comply with the duties set forth in this Article V, the Trustee shall be personally liable to the Trust Estate for:

(a) The amount of the Government Benefits lost during the period of ineligibility; and

(b) All reasonable costs incurred to restore the Beneficiary's eligibility, including attorney's fees and administrative costs.

5.8 Notification to Government Agencies. The Trustee shall report the existence of this Trust to SSA and to the Medi-Cal program as required by applicable law and agency regulations. The Trustee shall provide copies of this Trust Agreement to SSA and DHCS upon request.

5.9 Court-Ordered Trust Review. If required by Cal. Prob. Code § 3604 (applicable if first-party provisions under Article XII are invoked), the Trust shall be subject to ongoing Probate Court supervision as determined by the Court.

ARTICLE VI — ABLE ACCOUNT COORDINATION

6.1 CalABLE Account Authorization. The Trustee is authorized, but not required, to contribute Trust funds to a CalABLE account (California's Achieving a Better Life Experience program) established for the Beneficiary under Cal. Gov. Code §§ 4875–4885 and 26 U.S.C. § 529A.

6.2 Annual Contribution Limits. The Trustee shall not contribute more than the annual limit to the Beneficiary's ABLE Account. For 2026, the standard annual contribution limit is $20,000 (indexed to the gift tax annual exclusion). If the Beneficiary has earned income and does not participate in an employer-sponsored retirement plan, the Beneficiary may make additional ABLE to Work contributions of up to the lesser of the Beneficiary's gross wages or $15,650 (2026 amount, indexed to federal poverty level; 48 contiguous states).

6.3 SSI $100,000 Threshold. The Trustee shall monitor the balance of the Beneficiary's ABLE Account. If the ABLE Account balance exceeds $100,000, the Beneficiary's SSI cash benefits will be suspended (not terminated) until the balance falls below $100,000. The Beneficiary's Medi-Cal eligibility is NOT affected by ABLE Account balances up to $529,000 (the CalABLE program maximum).

6.4 Coordination Strategy. The Trustee shall coordinate SNT distributions and ABLE contributions as follows:

(a) For expenses the Beneficiary can manage independently (e.g., personal items, recreation, transportation), the Trustee may contribute to the ABLE Account so the Beneficiary can exercise autonomy and self-determination;

(b) For larger expenses that exceed ABLE Account limits or require direct vendor payment (e.g., vehicle purchase, home modifications, tuition), the Trustee shall pay directly from the Trust;

(c) For food and shelter, the Trustee should consider whether a contribution to the ABLE Account (which the Beneficiary then uses for food/shelter) produces more favorable results than a direct Trust distribution under the ISM/PMV rules;

(d) The Trustee shall document the rationale for choosing between Trust distributions and ABLE contributions in each case.

6.5 ABLE Account Payback. Upon the Beneficiary's death, amounts remaining in the ABLE Account are subject to Medicaid payback under 26 U.S.C. § 529A(f). This payback applies regardless of whether the Trust itself is a third-party or first-party SNT.

ARTICLE VII — SPENDTHRIFT PROVISIONS

7.1 Restraint on Alienation. To the maximum extent permitted by Cal. Prob. Code §§ 15300–15302, no interest of the Beneficiary in the income or principal of the Trust Estate shall be subject to voluntary or involuntary transfer, assignment, anticipation, pledge, encumbrance, attachment, garnishment, execution, or any other legal or equitable process, bankruptcy proceeding, or claim of any creditor, before actual receipt by the Beneficiary.

7.2 Prohibition on Beneficiary Assignment. The Beneficiary shall have no power to sell, assign, transfer, encumber, or otherwise dispose of the Beneficiary's interest in the Trust, nor to anticipate income or principal distributions, nor to compel the Trustee to make any distribution.

7.3 Exceptions Under California Law. The parties acknowledge the following exceptions to spendthrift protection under California law:

(a) Support Obligations. Under Cal. Prob. Code § 15305, a judgment creditor may reach a beneficial interest in the Trust to satisfy a court order for child support or spousal support;

(b) Restitution. Under Cal. Prob. Code § 15305.5, restitution judgments in criminal matters may be enforceable against the Trust;

(c) Tax Liens. Federal and state tax liens may attach notwithstanding the spendthrift clause;

(d) Self-Settled Trust Exception. Under Cal. Prob. Code § 15304, if the Trust were reclassified as a self-settled trust, the spendthrift provision would be void as to the Settlor's creditors. The Grantor represents that the Trust is funded solely with the Grantor's own assets.

7.4 Coordination with Government Benefits. Nothing in this spendthrift provision shall be construed to create an enforceable right of the Beneficiary to Trust income or principal. This Trust is purely discretionary, and no government agency shall have the right to compel distributions for the Beneficiary's support.

ARTICLE VIII — TERMINATION AND REMAINDER DISTRIBUTIONS

8.1 Termination Event. This Trust shall terminate upon the first to occur of:

(a) The death of the Beneficiary;

(b) The complete exhaustion of the Trust Estate;

(c) An order of the Probate Court directing termination.

8.2 Third-Party Trust — No Medicaid Payback Required. Because this Trust is funded exclusively with assets of the Grantor (and other third parties), and NOT with the Beneficiary's own assets, NO reimbursement or payback is owed to Medi-Cal, Medicaid, SSA, or any other government agency upon termination. The remaining Trust Estate shall be distributed as set forth in Sections 8.3 through 8.6.

8.3 Primary Remainder Distribution. Upon the Beneficiary's death, the Trustee shall distribute the remaining Trust Estate to the remainder beneficiaries designated in Schedule B, in the shares and manner specified therein.

8.4 Contingent Remainder Beneficiaries. If any remainder beneficiary designated in Schedule B predeceases the Beneficiary or is unable or unwilling to receive a distribution:

(a) First Contingency: That beneficiary's share shall pass to such beneficiary's then-living descendants, per stirpes;

(b) Second Contingency: If there are no such descendants, the share shall be redistributed pro rata among the surviving remainder beneficiaries named in Schedule B;

(c) Third Contingency: If no remainder beneficiary named in Schedule B survives the Beneficiary, the remaining Trust Estate shall be distributed to: [________________________________];

(d) Ultimate Contingency: If no designated contingent beneficiary survives, the remaining Trust Estate shall be distributed to [________________________________] [charitable organization] or, if no charitable organization is designated, to the Grantor's heirs at law as determined under California's law of intestate succession.

8.5 Staggered Distribution Option. The Grantor may specify in Schedule B that remainder distributions to any individual beneficiary shall be made in stages:

☐ Immediate lump sum distribution
☐ Staggered distribution:
- [____]% at age [____] or upon distribution, whichever is later
- [____]% at age [____]
- [____]% at age [____]
- Remaining balance at age [____]

If staggered distribution is elected, the Trustee shall continue to hold undistributed remainder shares in a separate trust for the benefit of the applicable remainder beneficiary under terms substantially similar to the California Uniform Transfers to Minors Act or, if the remainder beneficiary is an adult, under a simple discretionary trust for the beneficiary's health, education, maintenance, and support.

8.6 Trustee's Final Accounting. Upon termination, the Trustee shall:

(a) Prepare a final accounting of all Trust receipts, disbursements, assets, and liabilities from the date of the last accounting through the date of termination;

(b) Deliver the final accounting to all remainder beneficiaries and any interested party entitled to notice;

(c) File a final accounting with the Probate Court if required by court order or statute;

(d) Pay all outstanding Trust debts, expenses, and taxes;

(e) Reserve a reasonable amount for anticipated final tax obligations and administrative wind-down costs;

(f) Distribute the net remaining Trust Estate as directed above;

(g) Upon completion of all distributions, file any required final tax returns and provide written notice to all interested parties that the Trust has been fully administered and terminated.

8.7 Standing for Challenges. The following persons shall have standing to challenge distributions under this Article VIII: the Trustee, any remainder beneficiary designated in Schedule B, the Trust Protector (if appointed), and the Beneficiary's legal representative (guardian, conservator, or agent under power of attorney).

ARTICLE IX — TRUST PROTECTOR (CUDTA)

9.1 Appointment. The Grantor appoints [________________________________] as the initial Trust Protector. If the initial Trust Protector is unable or unwilling to serve, [________________________________] shall serve as successor Trust Protector. If no designated successor is available, the remaining Trust Protector position shall be filled by a person appointed by:

☐ Majority vote of the remainder beneficiaries
☐ The Probate Court upon petition of any interested party
☐ Other: [________________________________]

9.2 Trust Protector Powers. The Trust Protector, acting in a fiduciary capacity under Cal. Prob. Code § 16603, shall have the following powers, exercisable in writing delivered to the Trustee:

(a) Trustee Removal and Appointment. Remove any Trustee (with or without cause) and appoint a successor Trustee, provided the successor is not the Trust Protector, the Beneficiary, or a person whose appointment would disqualify the Beneficiary from Government Benefits;

(b) Amendment for Tax and Benefits Compliance. Amend administrative (non-dispositive) provisions of this Trust to comply with changes in tax law, Government Benefits eligibility rules, or trust administration law, provided no amendment shall alter the fundamental purpose of the Trust as a supplemental needs trust;

(c) Change of Situs and Governing Law. Change the situs of the Trust and the governing law to another state, if such change would benefit the Trust or the Beneficiary;

(d) Veto Power over Distributions. Veto any proposed distribution by the Trustee that the Trust Protector reasonably believes would adversely affect the Beneficiary's Government Benefits eligibility;

(e) Addition of Beneficiary Protections. Add provisions to this Trust to comply with new Government Benefits regulations;

(f) Mediation of Disputes. Direct that disputes among interested parties be submitted to mediation before litigation.

9.3 Limitations. The Trust Protector shall NOT have the power to:

(a) Make distributions from the Trust;

(b) Modify the dispositive provisions of the Trust (i.e., change the identity of the Beneficiary or remainder beneficiaries);

(c) Benefit personally from any exercise of power;

(d) Appoint himself or herself as Trustee.

9.4 Compensation. The Trust Protector shall be entitled to reasonable compensation for services rendered, payable from the Trust Estate, not to exceed $[________________________________] per year unless approved by the Probate Court.

9.5 Liability. The Trust Protector shall be liable only for actions taken in bad faith or with willful misconduct. The Trust Protector shall have no duty to monitor the Trustee's actions and the Trustee shall have no duty to monitor the Trust Protector's actions, consistent with Cal. Prob. Code § 16618.

9.6 Resignation. The Trust Protector may resign upon thirty (30) days' written notice to the Trustee and all adult, competent remainder beneficiaries.

ARTICLE X — TRUSTEE PROVISIONS

10.1 Acceptance. By executing this Agreement, the Trustee accepts the Trust and all fiduciary obligations imposed by this Agreement and by California law.

10.2 Trustee Powers. In addition to all powers conferred by the California Probate Code, the Trustee shall have the following powers:

(a) Invest and reinvest the Trust Estate in accordance with the Prudent Investor Rule (Cal. Prob. Code §§ 16045–16054), including the power to invest in stocks, bonds, mutual funds, exchange-traded funds, real property, certificates of deposit, money market accounts, and other investments;

(b) Retain any asset transferred to the Trust, including non-income-producing assets, if retention is consistent with the Trust's purposes;

(c) Buy, sell, exchange, lease, mortgage, or otherwise deal with real and personal property;

(d) Borrow funds, secured or unsecured, when necessary for Trust administration;

(e) Employ agents, attorneys, accountants, investment advisors, care managers, Benefits Counsel, and other professionals, and pay their reasonable fees from the Trust Estate;

(f) Establish and maintain checking, savings, and investment accounts;

(g) Compromise, adjust, arbitrate, or settle claims by or against the Trust;

(h) Make elections and file returns for tax purposes;

(i) Distribute property in kind, in cash, or partly in each;

(j) Establish reserves for taxes, expenses, and contingencies;

(k) Exercise all rights with respect to Digital Assets as described in Article XI;

(l) Contribute funds to the Beneficiary's ABLE Account as described in Article VI;

(m) Purchase life insurance, annuities, or other financial products if beneficial to the Trust;

(n) Maintain the Beneficiary's residence, including paying for modifications, repairs, and improvements.

10.3 Successor Trustees. If the Initial Trustee ceases to serve for any reason (resignation, removal, death, incapacity, or disqualification):

(a) First Successor Trustee: [________________________________]

(b) Second Successor Trustee: [________________________________]

(c) Institutional Successor: If no individual successor is willing and able to serve, the Trust Protector (if serving) shall appoint a qualified corporate fiduciary. If no Trust Protector is serving, the Probate Court shall appoint a corporate fiduciary upon petition of any interested party.

10.4 Resignation. A Trustee may resign upon sixty (60) days' written notice to the Trust Protector (if any), the Beneficiary (or the Beneficiary's legal representative), and the remainder beneficiaries then entitled to notice. The resigning Trustee shall deliver all Trust property, records, and a current accounting to the successor Trustee within thirty (30) days of the successor's acceptance.

10.5 Removal. A Trustee may be removed:

(a) By the Trust Protector under Section 9.2(a);

(b) By the Probate Court for cause, including breach of fiduciary duty, failure to account, incapacity, or conflicts of interest;

(c) By unanimous written agreement of the Grantor (if living) and all adult, competent remainder beneficiaries, with sixty (60) days' written notice to the Trustee.

10.6 Trustee Compensation. (Cal. Prob. Code § 15681.)

(a) Individual Trustee. If the Trustee is an individual, the Trustee shall be entitled to reasonable compensation as set forth in the trust instrument or, if none is specified, as determined by the Probate Court considering the factors under California Rules of Court, Rule 7.776.

(b) Specified Fee. The Trustee's annual compensation shall be:

☐ $[________________________________] per year (flat fee)
☐ [____]% of the fair market value of the Trust Estate per year
☐ $[________________________________] per hour for time expended
☐ Reasonable compensation as determined by the Probate Court
☐ Other: [________________________________]

(c) Reimbursement. In addition to compensation, the Trustee shall be reimbursed from the Trust Estate for all reasonable and necessary expenses incurred in Trust administration, including travel, professional fees, insurance premiums, bond premiums, and filing fees.

(d) Court Review. Any interested party may petition the Probate Court for review of the Trustee's compensation under Cal. Prob. Code § 17200.

10.7 Bond. The Trustee:

☐ Shall furnish a bond in the amount of $[________________________________], payable from the Trust Estate
☐ Shall NOT be required to furnish a bond

10.8 Co-Trustees. If co-Trustees are serving, they shall act by unanimous agreement unless this Agreement or a court order specifies otherwise. If co-Trustees cannot agree, the dispute shall be resolved by the Trust Protector (if serving) or by the Probate Court.

10.9 Accounts and Reports. The Trustee shall:

(a) Prepare an annual accounting of all Trust receipts, disbursements, assets, liabilities, and investment performance;

(b) Deliver the annual accounting to the Beneficiary (or the Beneficiary's legal representative), the Trust Protector (if any), and all remainder beneficiaries entitled to notice under Cal. Prob. Code § 16061.7;

(c) File accountings with the Probate Court as required by court order or statute;

(d) Maintain all records for not fewer than seven (7) years after final distribution;

(e) Provide interim accountings upon reasonable written request of the Trust Protector or the Probate Court.

10.10 Indemnification. The Trustee and the Trustee's agents, officers, and employees shall be indemnified from the Trust Estate against any claim, liability, or expense (including reasonable attorney's fees) arising from administration of the Trust, except to the extent resulting from the Trustee's intentional misconduct, gross negligence, or fraud. This indemnification shall survive the Trustee's resignation or removal.

10.11 Limitation of Liability. The Trustee's liability shall be limited to the Trust Estate. No personal assets of the Trustee shall be exposed, except for losses attributable to intentional misconduct, gross negligence, or fraud.

10.12 Insurance. The Trustee may purchase fiduciary liability insurance, paid from the Trust Estate, to cover potential claims arising from administration.

ARTICLE XI — DIGITAL ASSETS (RUFADAA)

11.1 Definition. "Digital Assets" has the meaning set forth in Cal. Prob. Code § 870(b) and includes any electronic record in which the Trust or the Beneficiary holds a right or interest.

11.2 Trustee Authority. The Trustee shall have full authority under RUFADAA to:

(a) Access, manage, control, continue, and transfer Digital Assets held in the Trust Estate or in accounts belonging to the Beneficiary (to the extent the Beneficiary has authorized such access);

(b) Access the content of electronic communications to the extent authorized by the Beneficiary or permitted by law;

(c) Request disclosure of a catalogue of electronic communications or Digital Assets from any custodian as defined in Cal. Prob. Code § 870(h);

(d) Petition the Probate Court for an order directing a custodian to disclose Digital Assets if the custodian fails to comply within sixty (60) days (Cal. Prob. Code § 883).

11.3 Beneficiary's Online Tool Designations. If the Beneficiary has used an online tool provided by a custodian (e.g., Google Inactive Account Manager, Facebook Legacy Contact, Apple Digital Legacy) to designate a person to access Digital Assets, those designations shall take priority over this Trust Agreement to the extent provided by Cal. Prob. Code § 871.

11.4 Digital Asset Inventory. The Trustee shall maintain an inventory of all known Digital Assets, updated at least annually, and stored securely with appropriate access controls. The inventory should include account names, custodians, and access credentials (stored in an encrypted format).

11.5 Cryptocurrency and Digital Currency. The Trustee is authorized to hold, manage, buy, sell, and exchange cryptocurrency and other digital currencies as part of the Trust Estate, subject to the Prudent Investor Rule and consistent with the Trust's investment objectives.

ARTICLE XII — OPTIONAL: FIRST-PARTY / SELF-SETTLED (d)(4)(A) PROVISIONS AND MEDI-CAL PAYBACK

12.1 Applicability. This Article XII applies ONLY to the extent the Trust Estate includes assets that constitute the Beneficiary's own property ("First-Party Assets"). If no First-Party Assets are contributed, this Article is void and of no effect.

12.2 Compliance with Federal Law. With respect to First-Party Assets, this Trust is intended to comply with the requirements of 42 U.S.C. § 1396p(d)(4)(A), which provides that a trust containing the assets of a disabled individual under age 65, established by the individual, a parent, grandparent, legal guardian, or a court for the benefit of such individual, shall not be counted as a resource if the trust provides that upon the death of the individual, the State(s) will receive all amounts remaining in the trust up to the total amount of medical assistance paid on behalf of the individual.

12.3 Court Approval Under Prob. Code § 3604. If First-Party Assets arise from money or other property paid or delivered pursuant to a compromise or judgment for the Beneficiary (as a minor or person with a disability), the terms of this Trust shall be reviewed and approved by the Probate Court under Cal. Prob. Code § 3604, and the Trust shall be subject to continuing court jurisdiction to the extent determined by the Court.

12.4 MANDATORY MEDI-CAL / MEDICAID PAYBACK PROVISION.

(a) Upon the death of the Beneficiary, and BEFORE any distribution of remaining First-Party Assets to remainder beneficiaries, the Trustee shall pay to the California Department of Health Care Services ("DHCS") an amount equal to the total medical assistance paid on behalf of the Beneficiary under California's Medi-Cal program, including amounts paid under Cal. Welf. & Inst. Code §§ 14000 et seq.

(b) If the Beneficiary received Medicaid benefits from any state other than California, the Trustee shall also pay to each such state's Medicaid agency an amount equal to the total medical assistance paid by that state on behalf of the Beneficiary.

(c) ORDER OF PAYBACK: Medi-Cal/Medicaid claims shall be satisfied FIRST, before any distribution to remainder beneficiaries. If the remaining First-Party Assets are insufficient to satisfy all state claims in full, the claims shall be paid on a pro rata basis among the claiming states, or as otherwise required by applicable law and SSA POMS SI 01120.203.

(d) The Trustee shall notify DHCS (and any other applicable state Medicaid agency) within thirty (30) days of the Beneficiary's death and shall provide each agency at least sixty (60) days to submit a claim before distributing remainder to non-government beneficiaries.

(e) The Trustee shall request from DHCS an itemized statement of all Medi-Cal benefits paid on the Beneficiary's behalf and shall verify the accuracy of such statement to the extent reasonably practicable.

12.5 Estate Recovery — Cal. Welf. & Inst. Code § 14009.5. The Trustee acknowledges that Medi-Cal estate recovery under Cal. Welf. & Inst. Code § 14009.5 applies to certain assets upon the Beneficiary's death. First-Party Assets remaining in the Trust are subject to Medi-Cal recovery. The Trustee shall comply with all applicable estate recovery provisions.

12.6 Third-Party Assets Exempt. For the avoidance of doubt, the payback requirement in Section 12.4 applies ONLY to First-Party Assets. Any portion of the Trust Estate attributable to third-party contributions (tracked and accounted for separately under Section 12.7) shall NOT be subject to Medi-Cal or Medicaid payback and shall be distributed to the remainder beneficiaries under Article VIII.

12.7 Sub-Accounting Requirement. If the Trust holds both First-Party Assets and third-party assets, the Trustee shall maintain separate sub-accounts to track:

(a) Contributions of First-Party Assets (with source, date, and amount);

(b) Contributions of third-party assets (with source, date, and amount);

(c) Income and appreciation allocated to each sub-account on a pro rata or other reasonable and consistent basis;

(d) Distributions charged to each sub-account.

12.8 Age 65 Limitation. No First-Party Assets shall be added to this Trust after the Beneficiary attains age 65. After age 65, a pooled trust under 42 U.S.C. § 1396p(d)(4)(C) may be available as an alternative.

ARTICLE XIII — PERPETUITIES SAVINGS CLAUSE

13.1 Statutory Rule. Notwithstanding any other provision of this Trust, no interest created under this Trust shall remain contingent or subject to a condition precedent beyond the period permitted under California's Uniform Statutory Rule Against Perpetuities, Cal. Prob. Code § 21205. Under Section 21205, a nonvested property interest is valid if:

(a) When the interest is created, it is certain to vest or terminate no later than twenty-one (21) years after the death of an individual then alive; or

(b) The interest either vests or terminates within ninety (90) years after its creation.

13.2 Savings Provision. If any Trust interest would violate the rule stated in Section 13.1, such interest shall be reformed by the Probate Court to the minimum extent necessary to comply with the applicable period, and the Trust shall be terminated and distributed as provided in Article VIII at the expiration of such period.

13.3 Measuring Lives. For purposes of the common-law component of Section 13.1(a), the measuring lives are the Beneficiary, the Grantor, and the remainder beneficiaries listed in Schedule B who are alive on the Effective Date.

ARTICLE XIV — GENERAL PROVISIONS

14.1 Entire Agreement. This Trust Agreement, together with Schedule A and Schedule B, constitutes the entire agreement among the parties and supersedes all prior oral or written statements, representations, or agreements.

14.2 Limited Amendment Authority. This Trust may be amended ONLY by written instrument signed by the Grantor (if living) and the Trustee, AND approved by the Trust Protector (if serving), and then solely for the purpose of:

(a) Correcting scrivener's errors;

(b) Complying with changes in tax law, Government Benefits rules, or trust administration statutes;

(c) Making administrative changes that do not alter the dispositive provisions or defeat the Trust's supplemental needs purpose.

No amendment shall eliminate or reduce the supplement-not-supplant standard of Section 4.2 or the Medi-Cal payback provision of Section 12.4 (if applicable). The Probate Court may authorize amendments that are beyond the scope of this Section if doing so furthers the Trust's purposes.

14.3 Severability. If any provision of this Trust is held invalid, unenforceable, or inconsistent with the Beneficiary's continued eligibility for Government Benefits, such provision shall be reformed to the minimum extent necessary to make it valid, enforceable, and consistent with benefits eligibility, and the remaining provisions shall remain in full force and effect.

14.4 Construction. This Trust shall be liberally construed to carry out its primary purposes: (a) to supplement, not supplant, Government Benefits available to the Beneficiary; and (b) to enhance the Beneficiary's quality of life. In the event of ambiguity, the interpretation that best preserves the Beneficiary's Government Benefits eligibility shall control.

14.5 No Contest Clause. If any beneficiary contests the validity of this Trust or any of its provisions, or seeks to obtain an adjudication that this Trust or any of its provisions is void, or seeks otherwise to void, nullify, or set aside this Trust or any of its provisions, then the right of that person to take any interest given to that person under this Trust shall be determined as provided in Cal. Prob. Code § 21311 (applicable to no-contest clauses).

14.6 Waiver. No waiver of any provision shall be effective unless in writing and signed by the waiving party. A waiver on one occasion shall not constitute a waiver on any subsequent occasion.

14.7 Notices. All notices required under this Trust shall be in writing and delivered personally, by certified mail (return receipt requested), or by recognized overnight courier, to the addresses specified in this Agreement or as updated in writing.

14.8 Counterparts and Electronic Signatures. This Agreement may be executed in counterparts, each of which shall be deemed an original. Electronic signatures are permitted to the extent authorized by applicable law, but the original execution of this Trust Agreement should be notarized as provided in Article XV.

14.9 Forum Selection. Exclusive venue for any judicial proceeding relating to this Trust is the Probate Court of the County of [________________________________], California.

14.10 No Jury Trial. Probate proceedings in California are tried without a jury absent statutory authority. Accordingly, no jury waiver is required or given.

14.11 Dispute Resolution.

(a) Mediation First. Before commencing any court action (other than emergency injunctive relief), the disputing parties shall attempt in good faith to resolve the dispute through mediation with a mediator experienced in trust and estate matters.

(b) Limited Arbitration. Non-benefit-eligibility disputes solely concerning investment performance, fees, or internal administrative matters may be submitted to binding arbitration under the Commercial Rules of the American Arbitration Association, upon unanimous written consent of all then-serving fiduciaries, the Trust Protector, and all competent adult beneficiaries.

(c) Court Jurisdiction Preserved. Issues affecting Government Benefits eligibility, injunctive relief, Trustee removal, Trust construction, and the Medi-Cal payback obligation (if applicable) remain within the exclusive jurisdiction of the Probate Court.

14.12 Attorneys' Fees. The Probate Court may award reasonable attorneys' fees and costs from the Trust Estate or against a breaching fiduciary, as justice requires, consistent with Cal. Prob. Code § 17211.

14.13 Force Majeure. The Trustee shall not be liable for delay or failure to perform due to events beyond reasonable control, including natural disaster, pandemic, war, civil unrest, or governmental action, provided the Trustee uses reasonable efforts to resume performance and mitigate harm.

14.14 Letter of Intent. The Grantor may prepare a non-binding Letter of Intent (also known as a Letter of Wishes, Memorandum of Care, or Life Plan) describing the Beneficiary's preferences, routines, medical history, social connections, living arrangements, care providers, and other information helpful to the Trustee. The Letter of Intent may be updated by the Grantor (or, if the Grantor is deceased, by the Beneficiary's legal representative) without amending this Trust. While not legally binding, the Trustee shall give the Letter of Intent thoughtful and respectful consideration in making distribution decisions.

ARTICLE XV — EXECUTION AND NOTARY ACKNOWLEDGMENT

IN WITNESS WHEREOF, the parties have executed this Special Needs Trust Agreement as of the Effective Date first written above.

GRANTOR:

Signature: _____________________________________________

Print Name: [________________________________]

Date: [__/__/____]

CO-GRANTOR (if applicable):

Signature: _____________________________________________

Print Name: [________________________________]

Date: [__/__/____]

TRUSTEE:

By executing below, the Trustee accepts the Trust and all fiduciary obligations imposed by this Agreement and by applicable law.

Signature: _____________________________________________

Print Name: [________________________________], Trustee

Date: [__/__/____]

TRUST PROTECTOR (if appointed at execution):

Signature: _____________________________________________

Print Name: [________________________________], Trust Protector

Date: [__/__/____]

CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT (Cal. Civ. Code § 1189)

A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

State of California
County of [________________________________]

On [__/__/____], before me, [________________________________], a Notary Public, personally appeared [________________________________], who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature: _____________________________________________

[NOTARY SEAL]

[// GUIDANCE (Additional Acknowledgment — Duplicate This Block for Each Additional Signer):

A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

State of California
County of [________________________________]

On [__/__/____], before me, [________________________________], a Notary Public, personally appeared [________________________________], who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature: _____________________________________________

[NOTARY SEAL]
]

SCHEDULE A — INITIAL TRUST PROPERTY

The Grantor hereby transfers the following property to the Trustee as the initial Trust Estate:

Item 1:
☐ Third-Party Asset ☐ First-Party Asset (Article XII applies)
Description: [________________________________]
Approximate Value: $[________________________________]

Item 2:
☐ Third-Party Asset ☐ First-Party Asset (Article XII applies)
Description: [________________________________]
Approximate Value: $[________________________________]

Item 3:
☐ Third-Party Asset ☐ First-Party Asset (Article XII applies)
Description: [________________________________]
Approximate Value: $[________________________________]

Total Approximate Initial Value: $[________________________________]

SCHEDULE B — REMAINDER BENEFICIARIES

Upon the death of the Beneficiary, the Trustee shall distribute the remaining Trust Estate (after satisfaction of any payback obligations under Article XII, if applicable, and after payment of final Trust expenses) as follows:

Remainder Beneficiary 1:
Name: [________________________________]
Relationship to Beneficiary: [________________________________]
Share: [____]%
Distribution Method:
☐ Outright distribution
☐ Staggered distribution (see Section 8.5)

Remainder Beneficiary 2:
Name: [________________________________]
Relationship to Beneficiary: [________________________________]
Share: [____]%
Distribution Method:
☐ Outright distribution
☐ Staggered distribution (see Section 8.5)

Remainder Beneficiary 3:
Name: [________________________________]
Relationship to Beneficiary: [________________________________]
Share: [____]%
Distribution Method:
☐ Outright distribution
☐ Staggered distribution (see Section 8.5)

Contingent Charitable Beneficiary (if all individual beneficiaries predecease):
Name: [________________________________]
EIN: [________________________________]
Share: 100% of any undisposed remainder

SOURCES AND REFERENCES

Federal Statutes and Regulations:
- 42 U.S.C. § 1396p(d)(4)(A) — First-party (self-settled) special needs trust exception
- 42 U.S.C. § 1396p(d)(4)(C) — Pooled special needs trust exception
- 42 U.S.C. § 1382c(a)(3) — Definition of disability for SSI purposes
- 26 U.S.C. § 529A — ABLE Act (Achieving a Better Life Experience)
- 20 C.F.R. § 416.1205 — SSI resource limitations
- 20 C.F.R. § 416.1212 — SSI resource exclusions (trust-related)

SSA Program Operations Manual System (POMS):
- SI 01120.200 — Trusts established prior to January 1, 2000, and third-party trusts
- SI 01120.201 — Trusts established with the assets of an individual on or after 01/01/00
- SI 01120.203 — Exceptions to counting trusts (d)(4)(A) and (d)(4)(C)
- SI 00835.300 — In-kind support and maintenance (ISM) and the PMV rule
- SI 00835.901 — Values for in-kind support and maintenance

California Probate Code:
- Cal. Prob. Code § 3604 — Court-supervised special needs trusts (minor/disabled person settlement funds)
- Cal. Prob. Code §§ 15300–15309 — Spendthrift trust provisions and exceptions
- Cal. Prob. Code § 15681 — Trustee compensation
- Cal. Prob. Code §§ 870–884 — RUFADAA (Revised Uniform Fiduciary Access to Digital Assets Act)
- Cal. Prob. Code §§ 16045–16054 — Prudent Investor Rule
- Cal. Prob. Code §§ 16600–16632 — CUDTA (California Uniform Directed Trust Act — trust protectors/directors)
- Cal. Prob. Code § 17200 — Petitions concerning trusts
- Cal. Prob. Code § 17211 — Attorney's fees
- Cal. Prob. Code § 21205 — Uniform Statutory Rule Against Perpetuities (90-year rule)
- Cal. Prob. Code §§ 21310–21315 — No-contest clause provisions

California Welfare and Institutions Code:
- Cal. Welf. & Inst. Code §§ 14000 et seq. — Medi-Cal program
- Cal. Welf. & Inst. Code § 14009.5 — Medi-Cal estate recovery

California Government Code:
- Cal. Gov. Code §§ 4875–4885 — CalABLE program

California Civil Code:
- Cal. Civ. Code § 1189 — Notary acknowledgment form

Additional Resources:
- CalABLE Program: https://calable.ca.gov/
- SSA Red Book (Work Incentives): https://www.ssa.gov/redbook/
- California DHCS Special Needs Trust Page: https://www.dhcs.ca.gov/services/Pages/Special-Needs-Trust.aspx
- Special Needs Alliance (attorney directory): https://www.specialneedsalliance.org/

This template is provided for informational purposes only and does not constitute legal advice. A qualified attorney experienced in special needs planning, public benefits law, and California trust law must review and customize this document before execution. Laws and Government Benefits rules change frequently. The statutory citations, benefit amounts, and contribution limits referenced herein are current as of the last_updated date and must be verified at the time of execution. Do not use this template without professional legal review.