When parents are setting up a Special Needs Trust in Massachusetts for a child, one of the primary considerations is who will serve as trustee in the event that the parents can no longer fill this role. The trustee is the person who would be in charge of making decisions about money and property, making distributions out of the trust, ensuring that they comply with the terms of the trust, making decisions about how to invest and manage the trust funds. and filing all necessary tax returns. This may or may not be the same person who is serving as a guardian of the beneficiary of the trust.
You may want to choose a professional trustee whose dedicated job is serving as trustee, rather than relying on a family member to handle the financial matters in addition to their own responsibilities. In addition, a professional trustee will generally have a team helping to run things so that one person isn’t solely responsible. A professional trustee will also have experience with the income tax requirements and other administrative tasks associated with being a trustee. Of course, they will also be paid for their work out of the trust funds and may not know your family member personally or to the extent others do.
On the other hand, having a family member as trustee can be helpful as they know the beneficiary personally and have a personal connection with them. While they may not charge money for their services, they will still likely need to hire professionals to assist them in their role (like accountants, attorneys, or financial advisers) and those people will need to be paid out of the trust.
What some people choose to do is appoint a professional to serve as trustee, and then name some family members as an advisory committee for the trust, so that all the needs of the beneficiary can be met by those people who are most appropriate for each job.
If this decision is holding up your planning, make a list of possible trustees and then talk with your attorney to help narrow down your choices.
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