Oklahoma § 60-175.705 - Trust for beneficiary with disability

§ 60-175.705. Trust for beneficiary with disability

TRUST FOR BENEFICIARY WITH DISABILITY

A. As used in this act:

1. "Beneficiary with a disability" means a beneficiary of a

first trust who the special-needs fiduciary believes may qualify for

governmental benefits based on disability, whether or not the

beneficiary currently receives those benefits or is an individual

who has been adjudicated incompetent;

2. "Governmental benefits" means financial aid or services from

a state, federal or other public agency;

3. "Special-needs fiduciary" means, with respect to a trust

that has a beneficiary with a disability:

Oklahoma Statutes - Title 60. Property

a.

a trustee or other fiduciary, other than a settlor,

that has discretion to distribute part or all of the

principal of a first trust to one or more current

beneficiaries,

b.

if no trustee or fiduciary has discretion under

subparagraph a of this section, a trustee or other

fiduciary, other than a settlor, that has discretion

to distribute part or all of the income of the first

trust to one or more current beneficiaries, or

c.

if no trustee or fiduciary has discretion under

subparagraphs a and b of this section, a trustee or

other fiduciary, other than a settlor, that is

required to distribute part or all of the income or

principal of the first trust to one or more current

beneficiaries; and

4. "Special-needs trust" means a trust the trustee believes

would not be considered a resource for purposes of determining

whether a beneficiary with a disability is eligible for governmental

benefits.

B. A special-needs fiduciary may exercise the decanting power

under Section 3 of this act over the principal of a first trust as

if the fiduciary had authority to distribute principal to a

beneficiary with a disability subject to expanded distributive

discretion if:

1. A second trust is a special-needs trust that benefits the

beneficiary with a disability; and

2. The special-needs fiduciary determines that exercise of the

decanting power will further the purposes of the first trust.

C. In an exercise of the decanting power under this section,

the following rules apply:

1. Notwithstanding Section 3 of this act, the interest in the

second trust of a beneficiary with a disability may:

a.

be a pooled trust as defined by Medicaid law for the

benefit of the beneficiary with a disability under 42

U.S.C., Section 1396p(d)(4)(C), as amended, or

b.

contain payback provisions complying with

reimbursement requirements of Medicaid law under 42

U.S.C., Section 1396p(d)(4)(A), as amended; and

2. Except as affected by any change to the interests of the

beneficiary with a disability, the second trust, or if there are two

or more second trusts, the second trusts in the aggregate, shall

comply with Section 3 or 4 of this act with respect to the interest

or interests of each other current beneficiary, presumptive

remainder beneficiary or successor beneficiary.

Added by Laws 2021, c. 268, § 5, eff. Nov. 1, 2021.