7 AAC 100.602 - General trust rules

(a) Except as provided under 7 AAC 100.604, if an applicant or recipient is the grantor of a revocable trust,

(1) the entire principal counts as an available resource to the applicant or recipient;

(2) a payment from the trust to, or for the benefit of, the applicant or recipient is income to the applicant or recipient; and

(3) a payment or a partial payment from the trust to a third party that does not benefit the applicant or recipient is a transfer of an asset for less than fair market value under 7 AAC 100.510.

(b) Except as provided under 7 AAC 100.604, if an applicant or recipient is the grantor of an irrevocable trust and the terms of the trust authorize the trustee to make a payment to, or for the benefit of, the applicant or recipient

(1) the principal of the trust is not a countable resource, but the maximum amount that the terms of the trust allow the trustee to pay to, or for the benefit of, the applicant or recipient is a countable resource regardless of actual payment;

(2) a payment from the trust to, or for the benefit of, the applicant or recipient is income to the applicant or recipient; and

(3) a payment, or a portion of a payment, from the trust to a third party that does not benefit the applicant or recipient is a transfer of an asset for less than fair market value under 7 AAC 100.510.

(c) Except as provided under 7 AAC 100.604, if an applicant or recipient is the grantor of an irrevocable trust under 7 AAC 100.600 and the terms of the trust prohibit a portion of that trust from being paid to, or for the benefit of, the applicant or recipient under any circumstances, that portion of the trust is a transfer of an asset for less than fair market value under 7 AAC 100.510. The date of the transfer is the date the trust was established or the date on which payment to, or for the benefit of, the applicant or recipient was foreclosed, whichever is later. An addition to the trust by the applicant or recipient is a new transfer of an asset for less than fair market value if

(1) the trust prohibits payment of that addition to, or for the benefit of, the applicant or recipient; and

(2) the addition occurred after the first transfer to the trust.

(d) Except as provided under 7 AAC 100.604, a payment from a trust is income to the applicant or recipient, according to the provisions of this chapter that are applicable to the applicant's or recipient's eligibility category, if the payment is

(1) made directly to the applicant or recipient;

(2) made to an individual acting on behalf of the applicant or recipient; or

(3) used to purchase a product or service from which the applicant or recipient receives some direct benefit.

(e) If the trust corpus includes assets contributed by more than one beneficiary, this section applies only to that portion of the trust assets actually contributed by the beneficiary who is an applicant or recipient.

Notes

7 AAC 100.602

Eff. 7/20/2007, Register 183

Authority:AS 47.05.010

AS 47.07.020

AS 47.07.040