CEA Special Needs Trust Planning 4

Question 1

A testamentary Special Needs Trust is created by which legal instrument?

Accepted Answer

A will

Answer

A testamentary SNT is established through a will and takes effect only upon the death of the person who created the will.

Question 2

What is the primary advantage of establishing a Special Needs Trust as a standalone inter vivos trust rather than a testamentary trust?

Accepted Answer

It can receive assets during the grantor's lifetime, including gifts and inheritances

Answer

An inter vivos SNT is created and funded during the grantor's lifetime, allowing it to receive contributions from multiple sources such as gifts, life insurance, and inheritances.

Question 3

Which type of trust can accept assets for multiple beneficiaries with disabilities, pooling investments while maintaining separate accounts?

Accepted Answer

Pooled (d)(4)(C) trust

Answer

A pooled trust under (d)(4)(C) aggregates funds from multiple beneficiaries for investment purposes while maintaining separate sub-accounts for each individual.

Question 4

When naming a successor trustee for a Special Needs Trust, what is the most critical consideration?

Accepted Answer

The successor must understand both disability law and the beneficiary's unique needs

Answer

A successor trustee must understand the complex intersection of disability law, government benefits, and the individual beneficiary's circumstances to administer the trust properly.

Question 5

Under the SSI resource rules, what is the current individual resource limit that makes an SNT necessary for benefit preservation?

Accepted Answer

$2,000

Answer

SSI recipients are limited to $2,000 in countable resources for individuals, making an SNT essential for holding larger amounts without disqualifying the beneficiary.

(CEA) Certified Estate Advisor Practice Test

(CEA) Certified Estate Advisor Practice Test

CEA Special Needs Trust Planning 4