Special Needs Trust - New Hampshire

SPECIAL NEEDS TRUST AGREEMENT

(New Hampshire)

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:

• [SETTLOR NAME(S)], with an address of [ADDRESS] (“Settlor”); and
• [TRUSTEE NAME] of [ADDRESS] (“Trustee”).

The beneficiary is [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 Trust Code, N.H. Rev. Stat. Ann. § 564-B (the “NH UTC”), and other applicable New Hampshire law (“Governing Law”). Trust proceedings under RSA 564-B:2-203 are within the jurisdiction of the Circuit Court, Probate Division (the “Forum Court”), with county venue determined by RSA 564-B:2-204, generally where the Trust's principal place of administration is or will be located.

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” – Proposed supplemental goods and services under Section 5.2, subject to an item-specific benefits review before payment.
“Trust Assets” – All property held by the Trustee from time to time.

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 reserves no unilateral power under this instrument to revoke, amend, or terminate the Trust. Any later modification or termination must satisfy an applicable legal route and the Trust's supplemental purpose.

3.3 Supplemental Purpose. The primary purpose of the Trust is to provide for the supplemental needs of the Beneficiary while preserving Government Benefits where the applicable program rules allow. This is intended as a third-party trust funded only with assets belonging to persons other than the Beneficiary or the Beneficiary's spouse, as described in SSA POMS SI 01120.200. N.H. Rev. Stat. Ann. § 167:4, V addresses income eligibility for public medical assistance and disregards distributions only to the extent they are disregarded for Title XVI purposes; it does not make every distribution harmless to SSI or Medicaid resource eligibility. Verify each funding source and proposed payment under the applicable program rules.

3.4 Spendthrift Intent. A Beneficiary's interest is subject to a restraint on voluntary and involuntary transfer under RSA 564-B:5-502. This provision does not bar the exception-creditor attachment route in subsection (f) or other claims preserved by applicable law.

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 or the Beneficiary's spouse, and (iii) the contributor executes a Joinder Agreement substantially in the form of Schedule B. If the Trustee discovers that property belonging to either was tendered or transferred, the Trustee shall segregate it and obtain benefits counsel's direction before accepting or using it under this third-party instrument.

4.3 Segregation of Assets. Trustee shall maintain Trust Assets separate from the Trustee's personal property. Under RSA 564-B:8-810(d), the Trustee may invest property of two or more separate trusts as a whole only if records clearly indicate each trust's respective interest.

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 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. Under the Social Security Administration's final rule at 89 Fed. Reg. 21,199 (Mar. 27, 2024), food expenses no longer enter the in-kind support and maintenance calculation, but whether others provide all meals can still affect which shelter valuation rule applies.

5.5 Distribution Requests. The Beneficiary or a representative may submit a written Distribution Request specifying the purpose and amount. The Trustee may also initiate a distribution without a request when appropriate under Section 5. The Trustee may require invoices, quotations, or other supporting documentation.

5.6 Trustee Discretion. Trustee shall exercise discretion in good faith and in accordance with the Trust's terms and purposes and the Beneficiary's interests, as RSA 564-B:8-814(a) requires even when an instrument uses words such as “absolute” or “sole.”

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. This Trust requires an annual accounting within ninety (90) days after each Accounting Period to the Beneficiary or the Beneficiary's legally authorized representative. Separately, Trustee shall identify and report to every person entitled under RSA 564-B:8-813(d), including qualified beneficiaries who request a report and the specified settlor or representative when the settlor lacks the capacity described there. The ninety-day date is a term of this Trust, not a deadline stated in § 8-813.

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 or the Beneficiary's spouse.

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 will not purport to amend or revoke this Trust by unilateral direction.

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

9. DEFAULT & REMEDIES

9.1 Breach of Trust. A violation by the Trustee of a duty owed to a Beneficiary is a breach of trust under RSA 564-B:10-1001.

9.2 No Private Delay. No notice-and-cure period in this Agreement delays a remedy authorized by applicable law.

9.3 Remedies. A person with standing may request the relief authorized by RSA 564-B:10-1001, including performance, an accounting, redress by payment or restoration, injunction, suspension, removal, appointment of a special fiduciary, or other appropriate relief.

9.4 Costs and Fees. Costs and attorney fees are available only when authorized by applicable law or court order.

10. RISK ALLOCATION

10.1 Exculpation and Indemnification. No term relieves the Trustee of liability beyond the limits permitted by RSA 564-B:10-1008. Reimbursement or indemnification from Trust property is available only as authorized by this Agreement and applicable law.

10.2 Personal Liability. RSA 564-B:10-1010 governs the Trustee's personal liability on fiduciary contracts, torts, and obligations arising from ownership or control of Trust property. This Agreement does not impose a blanket Trust-asset liability cap.

10.3 Insurance. Under RSA 564-B:8-816(a)(11), the Trustee may insure the Trustee against liability, with premiums payable from Trust Assets.

10.4 No Contractual Excuse. No force-majeure provision excuses a duty imposed by applicable trust law.

11. DISPUTE RESOLUTION

11.1 Governing Law. See Section 1.3.

11.2 Court and Venue. Trust proceedings are subject to the Probate Division jurisdiction in RSA 564-B:2-203 and the venue rules in RSA 564-B:2-204.

11.3 Optional ADR. By written agreement of all affected persons, a dispute may be submitted to mediation, arbitration, or another procedure to the extent permitted by RSA 564-B:8-816(a)(23) and other applicable law. This Agreement does not require ADR or remove any matter from a court that has exclusive jurisdiction.

11.4 Trial Rights. This Agreement does not waive any trial right supplied by applicable law.

11.5 Injunctive Relief. The probate court may grant an injunction as authorized by RSA 547:3-b and RSA 564-B:10-1001.

12. GENERAL PROVISIONS

12.1 Modification. This instrument grants neither Settlor nor Trustee a unilateral amendment power. A proposed modification or termination must satisfy an applicable route under RSA 564-B, such as court consideration of beneficiary consent under § 564-B:4-411, court modification for unanticipated circumstances under § 564-B:4-412, reformation for proven mistake under § 564-B:4-415, tax-objective modification under § 564-B:4-416, or a nonjudicial settlement under § 564-B:1-111 that meets its participant and material-purpose requirements. Trustee signature and court approval alone do not establish every route's conditions. Evaluate the effect on the Beneficiary and public benefits before implementing any change.

12.2 Termination. The Trust shall terminate upon the Beneficiary's death. Before then, the Trustee may seek court modification or termination if administration becomes uneconomic or continuation becomes unlawful. A termination for insufficient value under RSA 564-B:4-414 requires distribution consistent with this Trust's purposes and does not by itself accelerate the remainder beneficiaries' interests.

12.3 Remainder Distribution. After the Beneficiary's death, the Trustee shall pay proper trust expenses and claims, then distribute the remaining third-party Trust Assets to [PRIMARY REMAINDER BENEFICIARY]; if none, to [ALTERNATE BENEFICIARIES] per stirpes, subject to applicable law. If the Trust ends during the Beneficiary's life, the Trustee shall apply or transfer the remaining assets for the Beneficiary's benefit in a manner consistent with the Trust's supplemental purpose and applicable benefit rules. This instrument does not resolve any reimbursement or recovery issue for assets later found to belong to the Beneficiary.

12.4 Successor Trustee.
a. Designation. The first successor trustee shall be [SUCCESSOR TRUSTEE]. If a vacancy must be filled and that person cannot serve, RSA 564-B:7-704(c) gives the next appointment priority to a person chosen by unanimous agreement of the qualified beneficiaries, then to a person appointed by the court.
b. Acceptance. A successor trustee should document acceptance in writing. RSA 564-B:7-701(a) also permits the statutory alternative means of acceptance where the Trust's acceptance method is absent or not expressly exclusive.

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. This Agreement may be executed in counterparts. Electronic signatures and delivery may be used where permitted by applicable law and accepted by the person or institution relying on the document; separately executed conveyances and acknowledgments must meet their own formalities.

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: __________

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]