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MEDICAL MEDICAL MEDICAL MEDICAL MEDICAL MEDICAL MEDICAL expenditure of the trust that exceeds $5,000. It must be for the sole benefit of the individual. The trustee is also required to provide a reconciled financial accounting of the expenditures made from the trust on an annual basis or as otherwise requested by the DWSS. A justification of the expenditures must accompany the financial record to ensure the expenditures were used to or for the sole benefit of the individual. A transfer of assets penalty may apply. The trustee must immediately notify the DWSS when the disabled individual passes away and must, no later than three (3) months after the individual passes away or if the trust exemption is terminated, repay the state up to the amount of the individual’s cost of care. Any additions to, or augmentations of any funds to the trust after age 65, are considered assets which are not subject to the resource exemption. F-520.5 Pooled Trusts The trust must be irrevocable, must contain the assets of a disabled individual, and be established and managed by a non-profit association as defined in section 501(c) of the Internal Revenue Code (IRC) and which has tax-exempt status under section 501(a) of the IRC. Separate accounts are maintained for each beneficiary of the trust (like a bank that holds the assets of individual accountholders) but assets are “pooled” for investing and management purposes. An account may be established for the sole benefit of the disabled individual by the individual, or by the parent(s), grandparent(s), legal guardian(s) or a court. If the account provides a benefit to any other individual, this exception does not apply. The trust must also specify that upon the death of the disabled individual, the state receive all amounts remaining in the trust up to an amount equal to the total amount of medical assistance paid on behalf of the disabled individual. If the trust meets all the above requirements, the corpus (principle) of the trust is not considered available when determining resource eligibility. However, transfer of assets provisions may apply. For example, funds added to the trust after the disabled individual is aged 65 or funds used to pay for family vacations will be considered a transfer of assets. Any non-liquid resources, e.g., re-title of home from the trust to an individual removed from the trust may convert an exempt resource to a countable resource in the month it is removed from the trust. Resources removed from the trust not for the supplemental or special needs of the individual are considered assets disposed of for less than fair market value and a transfer of assets penalty will apply. Administrative and trust fees are allowed as deductions without counting as income in the month paid out. F-520.6 Miller Type or Qualified Income Trusts - QITs A trust established to enable individuals with income that exceeds the income limit, to become eligible for Institutional Medicaid or Home and Community Based Waiver (HCBW) programs by placing their income into the Trust. F-520.4 TREATMENT OF TRUSTS Special Needs Trust Division of Welfare and Supportive Services Medical Assistance Manual 25 Mar MTL 03/25