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Note Special needs trusts established prior to December 13, 2016, may not be established by the disabled individual. They may only be established by the disabled individual’s parent, grandparent, or legal guardian, or by a court.

Note In the case of a legally competent, disabled adult, a parent or grandparent may establish a seed trust using a nominal amount of their own money (for example, $10) or an empty or dry trust. After the trust is established, the disabled adult’s assets can be transferred into the trust. 3. The trust provides that, upon the death of the beneficiary, after subtracting taxes and a reasonable amount for administrative costs, Wisconsin Medicaid will receive all amounts remaining in the trust not in excess of the total amount of medical assistance paid on behalf of the beneficiary. A trust that meets the above criteria is treated as a special needs trust for Medicaid purposes even if the trust agreement does not specifically call it a special needs trust. A trust that does not meet the above criteria is not treated as a special needs trust for Medicaid purposes, even if it is called a special needs trust in the trust agreement. For trusts that do not meet the above criteria, availability must be determined according to the criteria in SECTION 16.6.3 REVOCABLE TRUSTS or SECTION 16.6.4 IRREVOCABLE TRUSTS. Additions to the trust principal made directly to the special needs trust before the beneficiary reaches age 65 are disregarded. Distributions from the trust are also disregarded. These disregards continue after the beneficiary turns 65, provided they continue to be disabled. Additions to the trust after age 65 In general, additions to the trust after the beneficiary turns 65 are not disregarded. The value of any non-excluded assets added to the trust after the beneficiary reaches age 65 is considered available to the beneficiary. However, if the beneficiary’s right to receive support payments, U.S. Military Survivor Benefit Plan payments, or payments from an annuity has been irrevocably assigned to the trust before the trust beneficiary turned 65, the payments are treated the same as payments made before the individual turned 65 and continue to qualify for the special needs trust exemption. Interest, dividends, or other earnings of the trust after the beneficiary reaches age 65 remain excluded. 16.6.6 Pooled Trusts A pooled trust contains the assets of many different individuals, each held in separate trust accounts and established for separate beneficiaries. Pooled trusts that contain the assets of a disabled individual are disregarded for Medicaid purposes if they meet the following conditions: 1. The pooled trust is established and managed by a nonprofit association. Separate accounts are maintained for each beneficiary, but assets are pooled for investing and management purposes. 2. Accounts are established solely for the benefit of the disabled individual(s), and the person has had their disability determined by DDB or SSA.