SPECIAL NEEDS TRUST AGREEMENT

(New Hampshire)

[// GUIDANCE: This template is drafted as a third-party supplemental (special) needs trust. If the trust will be funded with the Beneficiary’s own assets, substantial modifications—including statutory pay-back language under 42 U.S.C. § 1396p(d)(4)(A)—will be required.]

TABLE OF CONTENTS

1. Document Header
2. Definitions
3. Establishment & Purpose of Trust
4. Funding Provisions
5. Distribution Standards
6. Trustee Powers & Duties
7. Representations & Warranties
8. Covenants & Restrictions
9. Default & Remedies
10. Risk Allocation
11. Dispute Resolution
12. General Provisions
13. Execution Block

1. DOCUMENT HEADER

1.1 Title and Parties

THIS SPECIAL NEEDS TRUST AGREEMENT (the “Trust Agreement”) is made as of [EFFECTIVE DATE] (the “Effective Date”) by and between:

• [SETTLOR NAME(S)], with an address of [ADDRESS] (“Settlor”);
• [TRUSTEE NAME] of [ADDRESS] (“Trustee”); and
• [BENEFICIARY NAME], date of birth [DOB], currently residing at [ADDRESS] (the “Beneficiary”).

1.2 Recitals

A. Settlor wishes to set aside certain property for the sole benefit of Beneficiary, who has a disability that renders Beneficiary eligible, or potentially eligible, for means-tested government benefits.
B. Settlor intends that this Trust supplement, and not supplant, any such benefits.
C. Trustee is willing to accept the trusteeship on the terms set forth herein.

1.3 Governing Law & Jurisdiction

This Trust Agreement shall be governed by and construed in accordance with the New Hampshire Uniform Trust Code, N.H. Rev. Stat. Ann. § 564-B (the “NH UTC”), and other applicable New Hampshire law (“Governing Law”). Exclusive jurisdiction for routine trust matters shall lie in the [NAME OF COUNTY] Probate Court of the State of New Hampshire (the “Forum Court”).

2. DEFINITIONS

For ease of reference, capitalized terms are defined alphabetically below.

“Accounting Period” – Each calendar year ending December 31, or such shorter period as may be required upon termination.
“Affiliate” – Any entity controlling, controlled by, or under common control with the Trustee.
“Arbitration Dispute” – A dispute expressly designated for arbitration under Section 11.3.
“Beneficiary” – The individual identified in Section 1, and no other person, unless and until an Alternate Beneficiary is designated pursuant to Section 12.3.
“Disability” – A medically determinable physical or mental impairment that qualifies the Beneficiary for benefits under 42 U.S.C. § 1382c(a)(3).
“Distribution Request” – A written request by or on behalf of the Beneficiary in accordance with Section 5.5.
“Government Benefits” – Supplemental Security Income (“SSI”), Medicaid, and any other means-tested public assistance program.
“NH UTC” – See Section 1.3.
“Permitted Distributions” – Distributions made in accordance with Section 5.2.
“Protected Income & Resources” – Income and resources of the Beneficiary that must remain within program limits to preserve eligibility for Government Benefits.
“Qualified Expenses” – Supplemental goods and services that enhance the Beneficiary’s quality of life but are not deemed “support” for SSI/Medicaid purposes, as further described in Section 5.2.
“Trust Assets” – All property held by the Trustee from time to time.

[// GUIDANCE: Cross-check every capitalized term for consistent use throughout the instrument.]

3. ESTABLISHMENT & PURPOSE OF TRUST

3.1 Creation. Settlor hereby irrevocably establishes the “[BENEFICIARY NAME] Special Needs Trust” (the “Trust”) for the sole benefit of the Beneficiary.

3.2 Irrevocability. This Trust is irrevocable. Settlor expressly waives all rights, powers, and interests, whether at law or in equity, to revoke, amend, or terminate the Trust except as expressly permitted herein.

3.3 Supplemental Purpose. The primary purpose of the Trust is to provide for the supplemental needs of the Beneficiary without disqualifying Beneficiary from Government Benefits. The Trust is intended to qualify as a third-party supplemental needs trust under applicable Social Security Administration guidance (currently POMS SI 01120.200 et seq.).

3.4 Spendthrift Intent. The Trust is a spendthrift trust under NH UTC § 5-502; Trust Assets shall not be subject to voluntary or involuntary transfer, assignment, or legal process, except as expressly provided herein.

4. FUNDING PROVISIONS

4.1 Initial Funding. Concurrently with execution of this Agreement, Settlor is transferring to the Trustee the property described in Schedule A (the “Initial Corpus”).

4.2 Additional Contributions. Additional property may be added to the Trust at any time with Trustee’s consent, provided that (i) contributions are irrevocable, (ii) no contribution is made with assets of the Beneficiary, and (iii) the contributor executes a Joinder Agreement substantially in the form of Schedule B.

4.3 Segregation of Assets. Trustee shall maintain Trust Assets separate and apart from the personal assets of Trustee and shall not commingle Trust Assets with assets of any other trust, except as a prudent fiduciary may pool for investment pursuant to NH UTC § 8-816(18).

5. DISTRIBUTION STANDARDS

5.1 Sole Benefit. All distributions shall be for the sole benefit of the Beneficiary.

5.2 Qualified Expenses. Subject to Section 5.3, Trustee may pay for any Qualified Expense, including but not limited to:
a. Medical and dental services not otherwise covered;
b. Transportation, including adaptive vehicles;
c. Education, training, and vocational programs;
d. Personal care attendants, therapies, and habilitation services;
e. Recreation, vacations, and cultural experiences;
f. Personal electronics, furnishings, and adaptive equipment;
g. Legal, advocacy, and trustee services.

5.3 Preservation of Benefits. Trustee shall consult the applicable regulations and guidance to avoid distributions that would (a) be treated as “income” to the Beneficiary, (b) accumulate as “resources,” or (c) otherwise disrupt eligibility. Trustee may, but is not required to, seek direction from the Forum Court.

5.4 Prohibited Distributions. Trustee shall not distribute cash directly to the Beneficiary, nor pay for food or shelter if such payment would reduce benefits under 20 C.F.R. § 416.1130 et seq., unless Trustee determines that the benefit outweighs the reduction.

5.5 Distribution Requests. Distributions shall be made only upon a Distribution Request specifying the purpose and amount. Trustee may require invoices, quotations, or other supporting documentation.

5.6 Trustee Discretion Absolute. The discretion granted to Trustee under this Article is absolute and non-reviewable except for abuse of discretion or bad faith.

6. TRUSTEE POWERS & DUTIES

6.1 Standard of Care. Trustee shall administer the Trust as a prudent person would, consistent with NH UTC § 8-804, and in accordance with the special needs purpose herein.

6.2 Enumerated Powers. Subject to Sections 5 and 10:
a. Invest and reinvest Trust Assets in any prudent investment;
b. Employ agents, attorneys, investment advisers, and custodians;
c. Compromise, arbitrate, or litigate claims;
d. Lease, sell, exchange, or otherwise dispose of property;
e. Borrow money and encumber Trust Assets;
f. Participate in pooled-trust investments;
g. Execute documents necessary to carry out Trust purposes.

6.3 Records & Accountings. Trustee shall maintain complete books and records and provide an annual accounting within ninety (90) days after each Accounting Period to:
(i) the Settlor (if living),
(ii) the Beneficiary (or legal representative), and
(iii) such persons as the Forum Court may order.

6.4 Bond. No bond shall be required of Trustee unless ordered by the Forum Court.

6.5 Compensation. Trustee is entitled to reasonable compensation in accordance with NH UTC § 7-708, payable from Trust Assets.

7. REPRESENTATIONS & WARRANTIES

7.1 Settlor. Settlor represents that all property transferred is free of liens and that no contribution constitutes assets of the Beneficiary.

7.2 Trustee. Trustee represents that (i) Trustee is qualified to serve, (ii) Trustee has reviewed the Trust Agreement, and (iii) Trustee will administer the Trust in compliance with the NH UTC and all applicable benefit regulations.

7.3 Survival. The representations and warranties herein shall survive the Effective Date and not merge into any subsequent document.

8. COVENANTS & RESTRICTIONS

8.1 Trustee’s Ongoing Covenants. Trustee shall:
a. Monitor changes in Government Benefit rules;
b. Provide timely notice to the Beneficiary of any material Trust developments;
c. File tax returns as required;
d. Maintain insurance if prudent.

8.2 Settlor’s Covenant Not to Revoke. Settlor covenants that Settlor will not attempt to amend or revoke this Trust.

8.3 No Assignment by Beneficiary. Beneficiary shall not assign, pledge, or encumber any interest in the Trust.

9. DEFAULT & REMEDIES

9.1 Events of Default. An “Event of Default” occurs if:
a. Trustee materially breaches fiduciary duties;
b. Trustee becomes incapacitated, bankrupt, or resigns without successor;
c. Beneficiary challenges the Trust’s validity.

9.2 Notice & Cure. A Party alleging default shall give thirty (30) days’ written notice specifying the default. Trustee may cure within the notice period.

9.3 Remedies. Upon uncured default, the Forum Court may:
(i) remove and replace the Trustee;
(ii) surcharge Trustee to the extent of losses;
(iii) issue injunctive relief to protect Trust Assets.

9.4 Attorney Fees. The prevailing party in any action to enforce this Trust shall be entitled to reasonable attorneys’ fees and costs, payable from the losing party’s interest or, if Trustee is surcharged, from Trustee personally.

10. RISK ALLOCATION

10.1 Indemnification of Trustee. To the maximum extent permitted by law, Trustee shall be indemnified and held harmless out of the Trust Assets against all claims, liabilities, and expenses, except those resulting from Trustee’s bad faith, willful misconduct, or gross negligence.

10.2 Limitation of Liability. Trustee’s liability to any person shall in all events be limited to the value of the Trust Assets, and no personal liability shall attach to Trustee beyond such assets, absent a judicial finding of bad faith or willful misconduct.

10.3 Insurance. Trustee may purchase fiduciary liability insurance, premiums payable from Trust Assets.

10.4 Force Majeure. Trustee shall not be liable for delay or failure in performance caused by events beyond Trustee’s reasonable control, including natural disasters, pandemics, or changes in law.

11. DISPUTE RESOLUTION

11.1 Governing Law. See Section 1.3.

11.2 Forum Selection. All matters concerning administration or construction of the Trust shall be filed exclusively in the Forum Court, except as provided in Section 11.3.

11.3 Limited Arbitration. Any dispute solely regarding the amount of Trustee compensation must be submitted to binding arbitration administered by the American Arbitration Association under its Commercial Rules, sitting in [CITY], New Hampshire. The arbitrator shall have no authority to modify substantive Trust terms.

11.4 No Jury Trial. No provision herein waives a jury because the Forum Court customarily hears trust matters without a jury; however, should a jury become available, the Parties agree to proceed without one.

11.5 Injunctive Relief. Nothing herein shall limit the Forum Court’s equitable power to issue temporary, preliminary, or permanent injunctive relief to enforce Trust terms.

12. GENERAL PROVISIONS

12.1 Amendment. The Trust may be amended only by written instrument executed by Trustee and approved by the Forum Court, solely to (i) maintain Government Benefit eligibility, (ii) address tax law changes, or (iii) correct scrivener’s errors.

12.2 Termination. The Trust shall terminate upon the earlier of:
a. Beneficiary’s death;
b. Trust Assets becoming insufficient to justify administration, as determined by Trustee and approved by the Forum Court;
c. A final judicial determination that continuation is no longer lawful.

12.3 Remainder Distribution. Upon termination, remaining Trust Assets shall be distributed to [PRIMARY REMAINDER BENEFICIARY]; if none, to [ALTERNATE BENEFICIARIES] per stirpes. Under no circumstance shall any remainder revert to the Beneficiary’s estate or be subject to Medicaid pay-back, absent contrary law.

12.4 Successor Trustee.
a. Designation. The first successor trustee shall be [SUCCESSOR TRUSTEE]. If that person is unwilling or unable, the Forum Court shall appoint a qualified corporation or individual.
b. Acceptance. A successor trustee shall accept in writing and shall succeed to all powers and duties.

12.5 Severability. If any provision is invalid or unenforceable, the remaining provisions shall be interpreted to fulfill Settlor’s intent to the maximum lawful extent.

12.6 Integration. This Trust Agreement, including Schedules A–C, constitutes the entire agreement and supersedes all prior understandings.

12.7 Counterparts; Electronic Signatures. The Trust may be executed in counterparts and delivered electronically; each counterpart shall be deemed an original.

12.8 Headings. Headings are for convenience only and do not affect interpretation.

13. EXECUTION BLOCK

IN WITNESS WHEREOF, the Parties have executed this Trust Agreement as of the Effective Date.

13.1 Settlor

[SETTLOR NAME]

13.2 Trustee

[TRUSTEE NAME], Trustee

13.3 Acceptance by Trustee

I, [TRUSTEE NAME], accept the trusteeship and agree to administer the Trust in accordance with its terms.

[TRUSTEE NAME], Trustee

13.4 Notarization

State of New Hampshire )
County of [COUNTY] ) ss.

On this ___ day of ____, 20__, before me, the undersigned notary public, personally appeared [SETTLOR NAME] and [TRUSTEE NAME], proved to me through satisfactory evidence of identification, and acknowledged that they executed the foregoing instrument as their free act and deed.

Notary Public
My Commission Expires: ____

[// GUIDANCE: Check NH statutory requirements for witnessing/notarization if real property will fund the Trust; otherwise, one notarial acknowledgment generally suffices.]

Schedule A – Initial Corpus

[Detailed list of property transferred on the Effective Date]

Schedule B – Form of Joinder Agreement

[Insert Joinder template for additional contributors]

Schedule C – Trustee Fee Schedule

[Optional detailed fee structure]

[// GUIDANCE:
1. Review with a New Hampshire trusts & estates attorney before use.
2. Confirm POMS compliance at execution and prior to each distribution.
3. File any required probate docket statements with the Forum Court.
]