Special Needs Trust - Iowa

IOWA THIRD-PARTY SPECIAL NEEDS TRUST

This trust is made on [__/__/____] by [SETTLOR FULL LEGAL NAME] of [ADDRESS] (Settlor) and [INITIAL TRUSTEE FULL LEGAL NAME] of [ADDRESS] (Trustee). It is named [TRUST NAME]. The one current beneficiary is [BENEFICIARY FULL LEGAL NAME], born [__/__/____], of [ADDRESS] (Beneficiary). Settlor is neither Beneficiary nor Beneficiary's spouse.

1. Creation and present funding

Settlor declares this to be a supplemental needs trust under Iowa Code chapter 634A. Settlor presently and irrevocably transfers $[AMOUNT] in cash to Trustee, who acknowledges actual receipt by signing below and in Schedule A. Trustee holds that property under this instrument. Future property joins the trust only when actually transferred to and accepted by Trustee. Trustee shall reject property supplied by Beneficiary or Beneficiary's spouse, including property routed through another person for either of them. This instrument is designed for third-party property; do not use it to receive Beneficiary's own settlement, inheritance, or benefits without separate legal review of its source and applicable rules.

Settlor intends an irrevocable trust. Settlor retains no individual power to reclaim trust property or amend the distribution plan. Trustee has no power to add a current beneficiary. Any change or termination available under applicable law requires that law's conditions; this instrument gives no person a unilateral right to turn the trust property over to Beneficiary.

2. Supplemental purpose and discretion

Beneficiary has a disability within Iowa Code § 634A.1(1): [STATE THE APPLICABLE DISABILITY BASIS AND SUPPORTING DOCUMENTATION]. Trustee may distribute income or principal, or pay a provider directly, in Trustee's discretion to supplement Beneficiary's care, living expenses, education, transportation, equipment, recreation, and other needs when publicly funded benefits do not adequately meet them. Trustee shall consider the Beneficiary's circumstances and each program's current rules before a payment.

Trustee shall not make a disbursement that would replace, reduce, or substitute for publicly funded benefits otherwise available to Beneficiary or render Beneficiary ineligible for them. Payments may be made only to supplement or complement those benefits as Iowa Code § 634A.2(2) directs. Trustee should obtain program-specific advice before a payment whose benefit effect is uncertain. Beneficiary has no power to compel a payment, direct its recipient, revoke or terminate this trust for personal receipt of its property, or pledge trust property. Trustee shall exercise discretion reasonably and in good faith under Iowa Code § 633A.4214; the word “discretion” does not excuse a breach of fiduciary duty.

This trust does not guarantee SSI, Medicaid, or other program eligibility. Iowa Code § 634A.2(5) applies each program's own resource methodology; SSA's trust-resource review likewise turns on the Beneficiary's actual rights and the source of trust property.

3. Administration and beneficiary information

Trustee shall keep trust property separate, maintain records of receipts and payments, review benefit effects, and use trust property only for this trust's purposes. Trustee may retain suitable advisers and pay reasonable administration expenses from the trust. Trustee shall give qualified beneficiaries notice, access to the instrument, and accountings as required by Iowa Code § 633A.4213. Trustee shall also give Beneficiary or an authorized representative a written annual accounting. If a benefit program requires reporting, Trustee shall provide the information it requires.

Under Iowa Code § 634A.2(6), this supplemental needs trust is not subject to routine probate-court administration or routine court reporting and approval. Trustee's duties and liabilities continue. No clause here limits liability to trust assets or immunizes intentional misconduct, gross negligence, bad faith, reckless indifference, or profit from a breach.

4. Spendthrift protection

Before a distribution is received, a beneficiary may not transfer, assign, or encumber that beneficiary's trust interest, and a creditor may not reach it except as Iowa Code § 633A.2302 permits. This includes that section's exceptions for necessaries and authorized federal tax claims. This clause does not promise that any benefit agency will disregard trust property.

5. Successor trustees

If Trustee dies, resigns, is removed, or cannot serve, [FIRST SUCCESSOR FULL NAME, ADDRESS] shall serve; if unable or unwilling, [SECOND SUCCESSOR FULL NAME, ADDRESS] shall serve. A successor shall sign this instrument or a separate written acceptance before acting. If neither serves, the vacancy shall be filled under Iowa Code § 633A.4105. The departing Trustee or personal representative shall deliver trust property and records to the successor. A serving Trustee may resign by written notice to the qualified beneficiaries and successor, subject to applicable law and orderly delivery of the property.

6. Death of Beneficiary and complete remainder

This trust ends at Beneficiary's death or when no property remains. At Beneficiary's death, Trustee shall pay proper trust administration expenses and claims legally chargeable to the trust, then distribute all remaining property in the following shares. Complete the shares so they total 100%; name an alternate for every share.

If a remainder beneficiary has not survived Beneficiary, that beneficiary's named alternate takes the share. If the alternate has not survived, the share passes proportionately among the other surviving named recipients or their alternates. If none survives, all remaining property passes to [FINAL CONTINGENT BENEFICIARY FULL NAME AND ADDRESS]. Trustee shall document the final accounting and transfers.

7. Governing law and execution

Iowa law governs this trust. Settlor signs to establish and fund it; Trustee signs to accept both the office and the initial property.

Settlor: ______________________________ Date: [__/__/____]

[SETTLOR FULL LEGAL NAME]

Trustee: ______________________________ Date: [__/__/____]

[INITIAL TRUSTEE FULL LEGAL NAME]

Schedule A — property received

Settlor transfers $[AMOUNT] in cash to Trustee on [__/__/____]. Trustee acknowledges actual receipt of that sum for this trust. No item below belongs to this trust until its transfer is completed and accepted.

Trustee receipt signature: ______________________________ Date: [__/__/____]

Sources and references

Iowa Code chapter 634A and chapter 633A; SSA POMS SI 01120.200.