Legal Definitions - Support Trust

A Support Trust is a specific type of trust designed to provide for the essential needs of a beneficiary. It instructs a designated person or entity, known as the trustee, to distribute funds (which can include both income generated by the trust assets and the principal assets themselves) to the beneficiary. These distributions are made only to the extent necessary for the beneficiary's education, health, maintenance, or general well-being, as specified in the trust document.

A key characteristic of a Support Trust is that the assets held within it, up to the amount required for the beneficiary's support, are generally protected from the beneficiary's creditors. This means that creditors typically cannot seize these funds if doing so would prevent the trust from fulfilling its primary purpose of providing for the beneficiary's essential needs.

Here are some examples to illustrate how a Support Trust works:

• College Student's Living Expenses: Imagine grandparents establish a trust for their grandchild, Leo, to cover his university tuition, textbooks, and reasonable living expenses (such as rent and food) while he pursues his degree. The trust specifies that the trustee should disburse funds as needed for these educational and living purposes.

  This illustrates a Support Trust because the funds are specifically earmarked for Leo's education and essential support during a defined period. If Leo were to incur personal debt, his creditors generally couldn't access the trust funds designated for his tuition or rent, as that would directly undermine the trust's purpose of supporting his education.

• Adult with a Chronic Illness: Consider a couple who creates a trust for their adult daughter, Maria, who has a chronic medical condition requiring ongoing care, specialized equipment, and assisted living. The trust directs the trustee to pay for Maria's medical treatments, housing, and daily living expenses to ensure her comfort and well-being.

  This is a classic Support Trust. The trust's primary goal is to provide for Maria's essential health and maintenance needs. The funds are protected from her personal creditors, ensuring that her critical care and living expenses are consistently met without being jeopardized by unrelated financial obligations.

• Widow's Ongoing Maintenance: Before his passing, a husband establishes a trust for his wife, Sarah, to ensure she can maintain her standard of living, cover her mortgage payments, utilities, and healthcare costs for the rest of her life. The trust empowers the trustee to distribute funds as necessary to meet these ongoing needs.

  This demonstrates a Support Trust focused on maintaining a beneficiary's accustomed lifestyle. The trust's assets are dedicated to Sarah's essential support and maintenance. Should Sarah face financial difficulties or accumulate personal debts, the funds within this trust, necessary for her housing and daily living, would typically be shielded from her creditors, preserving her financial security as intended by her late husband.