A Pooled Trust is an example of a “first-party” trust in that it can be established by the individual with a disability. The name Pooled Trust is used since the funds deposited are pooled for investment purposes, but are accounted for separately by individual.
Requirements for a Pooled Trust:
- The pooled trust must be established and maintained by a non-profit organization.
- Assets are pooled for investment but accounted for separately.
- The account is for the benefit of an individual with a disability as defined in
42 USC1382 c(a)(3).
- The account is established by a parent, grandparent, guardian, court, representative payee or the individual.
- At the time of the beneficiary’s death, to the extent that funds are not retained by the trust, remaining funds are first used to pay back the State or Commonwealth for the Medical Assistance received by the beneficiary.
Other Notes about a Pooled Trust:
- This trust can be self-created and self-funded.
- Because there is no “look-back” period on a Pooled Trust, any funds received by the individual, or to which the individual is already entitled, can be deposited into a Pooled Trust and will no longer render the individual ineligible.
- For-profit corporate fiduciaries and family members cannot serve as trustees. Only non-profit associations can act as trustees for Pooled Trusts.
- A Pooled Trust is established using a Social Security Administration pre-approved form and does not require separate court approval. These trusts should be much less expensive to establish, and also, due to the pooling of accounts, the monthly maintenance costs are often less than those associated with individually created trusts.