Disability, family wealth and elder care records and questions checklist

Key takeaway

Gather trust instruments and beneficiary designations, benefit and representative payee records, documents establishing financial and health care authority, care agreements, and records of asset ownership, transfers, and tax basis.

Use the sections below to organize records and questions for a discussion with your advisers. Start with the documents you have, then identify the questions you want reviewed.

Care agreements and payments to relatives

Care agreements, service records and payment records belong together when reviewing payments to a relative for care or personal services. Gather the agreement alongside records showing what services were provided, when they were provided, and when payment occurred.

In Minnesota, for example, the medical assistance transfer statute applies to payments to relatives for care or personal services unless its agreement, direct benefit and reasonable compensation conditions are met. Compensation must be stipulated in a notarized written agreement existing when the services were performed. The services must directly benefit the person, and payments must represent reasonable compensation. Payment within 60 days after service removes the notarized written agreement requirement. The direct benefit and reasonable compensation requirements still apply. Other states differ.

In Minnesota, for example, the uncompensated transfer amount is the asset’s fair market value when transferred less compensation received. That amount alone does not calculate a penalty period or establish overall eligibility. Other states differ.

Agreement: Locate the written care agreement, any notarization, and the terms describing services and compensation.
Service history: Gather records of the services performed and how the person receiving care benefited.
Payment history: Match payments with service dates so the timing can be reviewed.
Compensation question: Ask what records are needed to review whether compensation was reasonable.

For care and cost planning, preferences, routines and family wishes, read the comparison of life care plans and letters of intent.

Trust and beneficiary records

Gather the governing trust instrument, amendments, funding records and beneficiary designations for review together. Include records identifying whose property funded the trust and the provisions addressing revocation, termination, control and payment rights.

In Minnesota, for example, a trust may be created by transferring property to a trustee during life or by will or another disposition effective at death. Other methods include an owner declaring that identifiable property is held as trustee or exercising a power of appointment in favor of a trustee. A trust under a living trust is not necessarily first created at death. These creation methods do not establish every institution’s acceptance of a beneficiary designation. Other states differ.

Funding and control: Identify contributions from the beneficiary, the beneficiary’s spouse and other contributors, then locate the instrument provisions governing control and enforceable payment rights. Ask for review of the actual funding and governing law before drawing a benefit conclusion from the trust’s name.
Trust protector authority: Collect the actual instrument language granting amendment or replacement powers, together with any restrictions and required notices. Ask which provisions govern the particular action being considered.
Pooled account documents: Bring the trust instrument, joinder agreement and funding records. Ask how the account’s funding source and actual terms affect retention by the trust, payment to the State and disposition of funds remaining at death.
Retirement beneficiary designations: Gather account beneficiary forms, the trust instrument, relevant disability or chronic illness evidence, and distribution records. Ask for review of the applicable trust, beneficiary, documentation and payout requirements before selecting a distribution approach.

For asset and tax discussions, bring acquisition and ownership records, valuations, the donor’s basis records for gifts, estate tax records for inherited property, IRA statements, distribution records and records of nondeductible contributions. Keep the proposed beneficiary designation available for the same review.

Amounts actually paid or distributed from a traditional IRA generally enter the recipient’s gross income under the applicable income tax rules and statutory exceptions. Nondeductible contributions can make part of a distribution nontaxable. The distribution rule alone does not establish that every proposed trust transaction is a distribution or that every distribution is fully taxable. For retirement beneficiary designation topics, read the disability, family wealth and elder care guide.

Benefits and representative payee records

Organize representative payee records by benefit program, payee, reporting requests and any applicable reporting exemption. Bring the records relevant to SSA’s appointment determination as well as records of benefit use.

Social Security and SSI representative payee accountability systems generally require reports on benefit use at least annually. Annual reporting exemptions include specified state institutions and federal institutions housing the beneficiary when the institution is the payee. Exemptions also include parents or legal guardians of minor beneficiaries who primarily reside in the same household. Parents of disabled beneficiaries who primarily reside in the same household, and spouses, are also included. SSA determines exemption eligibility. SSA may require a report whenever it has reason to believe benefits are being misused. An annual reporting exemption does not establish unrestricted authority over benefits.

Reporting file: Collect reporting requests, completed reports and records relevant to any claimed annual reporting exemption.
Appointment file: Locate records identifying the representative payee and the benefits covered by SSA’s determination.
Questions for review: Ask which records of benefit use and reporting requests need attention, and which documents establish the particular payment role.

Read the disability, family wealth and elder care guide for SSI reporting topics, trust coordination, powers of attorney and representative payee arrangements.

Incapacity and family care records

Gather the actual power of attorney, health care directive, court appointment and authority documents, together with relevant transaction records. Review each document for the powers granted and its limitations.

Durability and termination: In Minnesota, for example, durability depends on language showing that authority remains exercisable despite the principal’s later incapacity or incompetence. A durable power ends at the earliest of the principal’s death, its specified termination date, or commencement of dissolution, separation or annulment proceedings when the agent is the principal’s spouse. Revocation is ineffective against a party without actual notice. Other states differ.
Financial transaction records: In Minnesota, for example, an agent under a power of attorney must keep complete records of transactions entered into on the principal’s behalf. When exercising granted powers, the agent must act as an ordinarily prudent person would manage their own affairs, with the principal’s interests utmost in mind. An accounting is required when the principal requests it. An accounting is also required when the instrument requires one and specifies its recipient, or when the agent reimburses personal expenditures made for the principal. Keeping records and delivering an accounting are distinct duties. Other states differ.
Guardianship orders: In Minnesota, for example, a guardian remains subject to court control and direction. The court grants only powers necessary for the person’s demonstrated needs. Actual authority depends on the court’s grant. Collect the appointment and authority documents for review. Other states differ.
Medical record access: Locate the health care directive and any limitations relevant to the agent’s access to records. Keep the document available for review of the authority being exercised.

Common questions

Who determines whether Social Security or SSI benefits go to a representative payee?

SSA determines whether designated Social Security or SSI benefits go to a representative payee for the recipient’s use and benefit. SSA must determine that appointment serves the recipient’s interest after investigating the proposed payee and requiring adequate supporting evidence. Appointment operates regardless of the recipient’s legal competency or incompetency. Misuse requires prompt revocation or termination of payment to the payee and alternative payment arrangements.

Can a health care agent obtain and review medical records?

Yes, in Minnesota, for example, an agent acting pursuant to a health care directive has the principal’s rights to receive, review and obtain copies of medical records unless the directive specifies otherwise. The agent also has the principal’s right to consent to disclosure, subject to the same limitation. Authority depends on the person’s role under the directive. Other states differ.