The question of whether a special needs trust (SNT) can fund subscription boxes geared towards skill-building is a frequently asked one, particularly in San Diego where we see a significant number of families establishing trusts for loved ones with disabilities. The short answer is generally, yes, *provided* the terms of the trust allow it, and the purchases align with the beneficiary’s health, education, maintenance, and support as defined by the trust document and, critically, as interpreted under Supplemental Security Income (SSI) and Medicaid rules. Ted Cook, as a San Diego trust attorney, often guides clients through these nuances, ensuring compliance with complex regulations while maximizing the benefits for their family member. Approximately 65 million Americans, or 26% of adults in the United States, have some type of disability, highlighting the widespread need for thoughtful planning. It’s not simply about *can* you spend the money, but *how* that spending impacts essential benefits.
What are the core requirements for SNT distributions?
The foundational principle governing SNT distributions is that they must be used for the benefit of the beneficiary, and not result in disqualification from needs-based government programs like SSI and Medicaid. These programs have strict income and resource limits, and exceeding those limits can lead to a loss of benefits. Subscription boxes fall into a gray area, as they aren’t strictly “medical” expenses but can demonstrably contribute to skill development and overall well-being. The key is demonstrating that the box directly supports the beneficiary’s education, daily living skills, or therapeutic goals. Ted Cook emphasizes the importance of meticulous record-keeping to support these claims. For example, if a subscription box contains materials for adaptive art therapy, or supports communication skills for a non-verbal individual, that strengthens the justification for the expense.
How do subscription boxes fit into “maintenance and support”?
“Maintenance and support” is broad language within SNTs, but it’s not limitless. It generally covers necessities like food, clothing, shelter, medical care, and personal care. However, courts and administering agencies are increasingly recognizing the importance of enriching activities that improve quality of life and foster independence. A subscription box that focuses on life skills – say, a cooking box with adapted recipes and tools, or a box teaching financial literacy with simplified concepts – can fall under this umbrella. It’s about demonstrating a functional need, not merely a desire. Ted Cook frequently advises clients to consider a “pilot period” – purchasing a few boxes to assess their value and document the beneficiary’s progress before committing to a longer subscription. This provides concrete evidence of benefit.
Can the trust document restrict what can be purchased?
Absolutely. The trust document is the governing document, and it can specifically prohibit or limit certain types of expenditures. Some families, for example, may wish to exclude entertainment or luxury items, even if they technically fall within the “maintenance and support” definition. Others might prioritize specific therapeutic interventions and restrict funds to those areas. Ted Cook always advises clients to carefully consider their values and goals when drafting the trust document, ensuring it reflects their wishes for the beneficiary’s future. It’s far easier to clarify these parameters upfront than to argue about them later with a trustee or government agency.
What happens if the subscription box is considered “unnecessary” by SSI?
This is where things can get tricky. If SSI deems the subscription box to be an “unnecessary” expense, it could be counted as unearned income, potentially reducing the beneficiary’s SSI benefit. The agency looks at whether the expense improves or maintains the beneficiary’s ability to perform daily living activities. A purely recreational box, for instance, would likely be challenged. However, a box focused on vocational training or cognitive stimulation would have a stronger argument. A few years ago, I knew a family where their adult son, with Down syndrome, loved a monthly Lego subscription. It was his passion, and he built amazing creations, but SSI initially questioned the expense. Thankfully, his therapist wrote a letter explaining how the building fostered fine motor skills, problem-solving, and spatial reasoning – justifying the purchase.
A story of a misplaced priority
I once worked with a family who established a trust for their son with autism. They were very proud of their “generosity” in allowing him a significant monthly allowance for online gaming subscriptions. While this brought him short-term enjoyment, it completely overshadowed more beneficial expenditures, like occupational therapy or social skills training. SSI eventually flagged the high spending as inconsistent with his needs, and the trustee had to justify the allowance. It was a difficult situation that could have been avoided with careful planning and a focus on long-term well-being. The family realized they hadn’t considered the bigger picture when making these decisions.
How can a trustee proactively protect the beneficiary’s benefits?
Proactive documentation is key. Before approving a subscription box purchase, the trustee should document how it aligns with the beneficiary’s care plan, IEP goals, or therapeutic recommendations. This could include letters from therapists, educators, or other professionals. Maintaining a clear record of expenditures and their purpose demonstrates responsible trust administration and strengthens the case for legitimate expenses. Ted Cook often recommends a “benefit review” before making significant purchases, where a qualified professional assesses the potential impact on SSI and Medicaid eligibility. It’s a small investment that can prevent major headaches down the road.
A story of successful skill-building through trust funding
A client of mine had a daughter with cerebral palsy who struggled with communication. They used funds from her SNT to subscribe to a box designed to teach augmentative and alternative communication (AAC) skills. The box included picture cards, communication boards, and interactive activities. Over time, her daughter’s communication skills dramatically improved, allowing her to express her needs and participate more fully in her community. This wasn’t just a fun activity; it was a life-changing intervention that enhanced her independence and quality of life. The trustee meticulously documented the progress with reports from her speech therapist, ensuring the ongoing eligibility for benefits. It was a beautiful example of how a trust can be used to empower a beneficiary and support their growth.
Who Is Ted Cook at Point Loma Estate Planning Law, APC.:
Point Loma Estate Planning Law, APC.2305 Historic Decatur Rd Suite 100, San Diego CA. 92106
(619) 550-7437
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