Kentucky Statutes 367.937 – Permissibility of irrevocable trust provision — Effect on determining eligibility for entitlement programs — Required form for application
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(1) Notwithstanding the provisions of KRS § 367.936 to the contrary, an agreement, contract, or plan may provide that the trust shall be irrevocable during the lifetime of the beneficiary or grantor, if at the time of the signing of an agreement, contract, or plan or at any time thereafter, the beneficiary or grantor of the trust is, becomes, applies, or intends to apply to be an aged, blind, or disabled recipient of benefits pursuant to the federal Supplemental Security Income program under Title XVI of the Social Security Act or any other federal or state entitlement program. Funds irrevocably set aside for burial reserves, burial spaces, or other funds for funeral and burial expenses, including interest thereon shall be excluded as a financial resource in determining the beneficiary’s or grantor’s eligibility under any federal or state entitlement program as long as exclusion is not prohibited by any federal law or regulation governing the entitlement program.
(2) An application for an irrevocable trust shall be on a form developed by the Attorney General, which shall require proof that the beneficiary or grantor has received, applied for, or intends to apply for entitlement benefits within thirty (30) days of the signing of the agreement, contract, or plan. The form showing proof shall thereafter be maintained in the files of the agent.
(3) If, for any reason, a beneficiary or grantor of the trust fails to apply for entitlement benefits within thirty (30) days of his written intention to do so, fails to receive, or otherwise becomes ineligible for entitlement benefits, then the trust shall be a revocable trust.
(4) An irrevocable trust established pursuant to this section shall not affect the selection of funeral goods or services or the selection of the funeral home. At any time the beneficiary or grantor of the trust may, by written request to the agent and trustee, change the agent, trustee, or both.
(5) All agreements, contracts, or plans entered into prior to the enactment of this statute may be made irrevocable pursuant to the provisions of this section upon written application to the agent.
Effective: July 14, 1992
History: Created 1992 Ky. Acts ch. 75, sec. 1, effective July 14, 1992.
(2) An application for an irrevocable trust shall be on a form developed by the Attorney General, which shall require proof that the beneficiary or grantor has received, applied for, or intends to apply for entitlement benefits within thirty (30) days of the signing of the agreement, contract, or plan. The form showing proof shall thereafter be maintained in the files of the agent.
Terms Used In Kentucky Statutes 367.937
- Attorney: means attorney-at-law. See Kentucky Statutes 446.010
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Contract: A legal written agreement that becomes binding when signed.
- Entitlement: A Federal program or provision of law that requires payments to any person or unit of government that meets the eligibility criteria established by law. Entitlements constitute a binding obligation on the part of the Federal Government, and eligible recipients have legal recourse if the obligation is not fulfilled. Social Security and veterans' compensation and pensions are examples of entitlement programs.
- Federal: refers to the United States. See Kentucky Statutes 446.010
- Grantor: The person who establishes a trust and places property into it.
- Irrevocable trust: A trust arrangement that cannot be revoked, rescinded, or repealed by the grantor.
- Revocable trust: A trust agreement that can be canceled, rescinded, revoked, or repealed by the grantor (person who establishes the trust).
- State: when applied to a part of the United States, includes territories, outlying possessions, and the District of Columbia. See Kentucky Statutes 446.010
- Statute: A law passed by a legislature.
- Trustee: A person or institution holding and administering property in trust.
(3) If, for any reason, a beneficiary or grantor of the trust fails to apply for entitlement benefits within thirty (30) days of his written intention to do so, fails to receive, or otherwise becomes ineligible for entitlement benefits, then the trust shall be a revocable trust.
(4) An irrevocable trust established pursuant to this section shall not affect the selection of funeral goods or services or the selection of the funeral home. At any time the beneficiary or grantor of the trust may, by written request to the agent and trustee, change the agent, trustee, or both.
(5) All agreements, contracts, or plans entered into prior to the enactment of this statute may be made irrevocable pursuant to the provisions of this section upon written application to the agent.
Effective: July 14, 1992
History: Created 1992 Ky. Acts ch. 75, sec. 1, effective July 14, 1992.