The Trustee of a Special Needs Trust for an Adult Disabled Person May Make Distributions for Pornographic Materials According to Several Special Needs Legal Specialists

A recent question to the Academy of Special Needs Planners (ASNP) members-only Listserv generated a great deal of discussion about when a trustee can or should exercise discretion in approving payments from special needs trust funds for pornographic materials.

The member posting the question asked “Does anyone have an argument as to why the trustee of a special needs trust should or should not pay for pay-per-view pornography viewed by the beneficiary?” The beneficiary’s mother claimed that watching adult movies was an outlet for the beneficiary because he had a limited social life. The trustee felt that paying for the viewing of 12 adult movies in four days was a waste of the trust’s assets and that the trustee’s duty to conserve the assets prevented the payment.

Special needs trusts are specifically designed to provide beneficiaries with access to services and care above and beyond the benefits that they receive from government programs. However, the government places several important restrictions on these trusts which, when followed, allow a beneficiary to keep his or her benefits. One of the most important restrictions prohibits a beneficiary from having any control over the assets in the trust — the trustee must have full discretion to distribute the trust funds for the benefit of the person with special needs without interference.

In cases where an adult trust beneficiary suffers from a purely physical disability that does not cause any cognitive impairment, a tension often develops between the beneficiary, who wants access to the trust funds, and the trustee, who must serve as a gatekeeper. Since a special needs trust cannot usually provide money directly to a beneficiary, it is the trustee’s job to arrange for payment directly with the provider of a service for things a beneficiary needs, things that in some cases may be questionable. Chances are that if you serve as a trustee for a beneficiary in this situation, you will face (or have already faced) a request from the beneficiary for the trust to pay for something that you may not personally feel good about, like cigarettes, liquor or pornography.

The majority of the ASNP members who responded to the post believed that the trustee should probably approve the payments, although there were several caveats. One respondent suggested purchasing movies instead of approving multiple pay-per-views. However, the same writer believed the trustee had the discretion to make the decision one way or the other. Another attorney pointed out that people with special needs often have difficulty expressing their sexuality, and the movies could be a valid and understandable benefit, but he cautioned the trustee to search for adult production companies that did not take advantage of their performers or exploit vulnerable groups.

Several other participants spoke out strongly in favor of the beneficiary’s right to view what he wants without the trustee imposing his or her own values. On the other hand, several attorneys suggested that the trustee should seek out other alternatives that may provide more lasting benefits to the person with disabilities. “I wrestle with purchasing cigarettes for folks as well,” one member wrote. “[a]lso, even though gambling is legal here, I do not make disbursements for this.”

None of the attorneys participating in the discussion felt that the distribution was prohibited under the guidelines set forth in the Social Security Administration’s Program Operation Manual System (“POMS”), especially since movies do not count under either food or shelter.