Search
  • Herb Thomas

Fiduciary Considerations in a Special Needs Trust

Updated: Sep 25

There are many considerations to contemplate in the process of establishing a Special Needs Trust (SNT). One of the first concerns is who will serve as the Trustee/administrator or fiduciary of the SNT. When a fiduciary is named, that person then has a legal responsibility to act on behalf of the beneficiary’s best interests. This act of loyalty is known as ‘Fiduciary Responsibility’. As an example, parents have a fiduciary responsibility to their children. Parental duties, at the most basic level, require the sheltering, educating, feeding and care of children.




Key Elements of Fiduciary Responsibility


Some primary elements of the fiduciary responsibility include marshaling assets (cash, savings, real property, investments, and collectible items) that belong to the trust. Once those assets are gathered, the fiduciary needs to understand the needs (e.g., medical, societal, financial, and personal) of the trust beneficiary and work with parties who can help the fiduciary use the financial resources to the benefit of the trust beneficiary. The fiduciary is also responsible for paying for services and bills related to the well-being of the beneficiary, such as filing/paying taxes, and providing a yearly accounting report.


When selecting a fiduciary service or even a person, it is important to select an entity who is familiar with a variety of programs and systems that touch the administration of the trust. Some examples include public benefit programs, taxation issues, therapeutic programs, and educational advocates, etc.


Oversight of the Fiduciary


Once the fiduciary is selected and begins serving, oversight of the fiduciary must be built into the trust document itself to provide protection to a beneficiary who may be unable to monitor the activities of the trustee. You have at least three options for providing the supervision of the trustee’s activities. The Court system, in California the Professional Fiduciaries Bureau, and a Trust Protector or a Trust Advisory Committee.


In California, the Superior Court, through local counties, has Probate Departments to appoint and oversee the activities of trustees, where the beneficiaries are minors, or cognitively impaired. The Court goes to great lengths to ensure that the trustee is providing support to the trust beneficiaries and is not violating any fiduciary responsibilities. The penalties for breaching any of those duties or standards can result in large surcharges or even the loss of the fiduciary license.


In 2008, the state of California established the Professional Fiduciaries Bureau, which is an agency that controls the licensing and regulation of professional licensed fiduciaries. To become a licensed fiduciary in California a person has to pass an extensive background check, meet educational standards that include a college degree, completion of fiduciary educational credits, and complete ongoing educational requirements.


Fiduciary Services Main Objectives


Our main objective is to help beneficiaries with special needs achieve the support and financial security they need throughout their lives. We assist special needs individuals of all ages, and we value empathy and honesty. We listen and understand as we too have special needs family members that we care about. It’s a tough path to navigate on your own, but with our knowledge, experience and care, along with your love and commitment, together we can reach the main objectives that our clients have for their loved ones.


Kairos Fiduciary Services is a private fiduciary firm with offices in Alameda, Orinda, and Fresno, California. We focus primarily on Special Needs Trusts and have a long track record of meeting the needs of our clients. Kairos Fiduciary Services is also a member of the Professional Fiduciary Association of California, Financial Planning Association, and the Academy of Special Needs Planners.


For help planning a Special Needs Trust, please call (510) 749-8358, or email our office at info@kairosfiduciary.com.

45 views

Kairos Fiduciary Services

875-A Island Drive, #387
Alameda, CA 94502-6768

PMB 516

21 Orinda Way Suite C

Orinda, CA 94563

1444 Fulton Street
Fresno, CA 93721

510-749-8358
510-749-8376

info@kairosfiduciary.com

We'd Love to Hear from You!

©2020 Kairos Fiduciary Services.  All rights reserved.