The True Link Visa Card can be a powerful tool to allow a beneficiary with a Special Needs Trust to spend with some independence while helping to protect their benefits and ensure compliance with the terms of the trust. Some card administrators ask us how they can set up the Spending Settings to best accomplish this goal. Every situation is different, and we are not able to offer legal, financial, or other professional advice, so we can’t provide a one-size-fits-all answer. We strongly encourage you to consult with a professional familiar with Special Needs Trusts to tailor the settings to your specific needs. That said, we can share common approaches many customers adopt when configuring the Spending Settings with a focus on benefits eligibility and the trust’s unique requirements.
Typically, our customers aim to empower beneficiaries to make purchases that comply with the rules of their Special Needs Trust while also preventing transactions that could jeopardize the trust’s compliance or the beneficiary’s eligibility for benefits, as well as to protect them from being taken advantage of. Some spending categories are commonly blocked by card administrators because they are almost always non-compliant. Other categories may include purchases that could be acceptable or unacceptable depending on the context, requiring the card administrator to assess the level of trust they have in the beneficiary to make only allowable transactions. Below, we outline some of the spending categories that trustees often consider when configuring the Spending Settings.
Some spending categories directly impact a beneficiary’s eligibility for benefits like Supplemental Security Income (SSI). These include expenses considered in-kind support and maintenance (ISM), which can reduce SSI payments. To help protect benefits, card administrators usually block access to cash (which can make it difficult to verify how funds were spent and may be considered income to the beneficiary) or expenses considered In-Kind Support and Maintenance (ISM) like shelter expenses (e.g., rent, mortgage payments, property taxes, utilities):
- Cash withdrawals at ATMs
- Cash withdrawals inside a bank
- Cash-back at time of purchase
- Financial Transactions
- Gambling & Casinos
- Home Repair & Maintenance
- Hotels (hotels are often compliant for short stays related to vacation or medical travel but may be flagged as shelter expenses if used as long-term accommodations)
- Insurance
- Money Transfers
- Utilities
- Taxes & Government
Beyond maintaining SSI eligibility, trustees must ensure that all spending aligns with the specific terms of the trust. These restrictions vary depending on the trust document but commonly include:
- Charitable donations – Many SNTs include a sole benefit rule, meaning funds must be used exclusively for the beneficiary’s needs. Charitable donations often violate this rule unless explicitly allowed in the trust. You can block Charitable Donations in the Spending Settings. Please note that merchants like Goodwill are typically classified as charities, so if you know that your beneficiary shops there or at similar merchants, you may want to add a Merchant Exception to allow transactions at Goodwill while blocking other transactions with charities.
- Food – Although recent SSA changes allow food purchases without affecting SSI benefits, trustees should still verify that such purchases align with the trust’s terms and budget. Blocking grocery stores, restaurants, bars and liquor stores, or purchases inside the gas station may be appropriate if food purchases are not permitted or if you have concerns the beneficiary may purchase food items for another person.
- Luxury or non-essential items – Depending on the terms and size of the trust, purchases for big-ticket items, such as high-end electronics or vacations, may or may not be appropriate. Many trustees evaluate these types of requests on a case-by-case basis and may choose to make a one-time transfer to the card for such purchases once they are approved. In these instances, you may want to temporarily allow a certain category and restrict it again once the purchase is complete.
If you are not confident that the beneficiary will avoid purchasing prohibited items, will purchase items for anyone other than themself, or if you’re not confident that they will reliably share receipts for certain transactions to allow you to verify that these purchases are ok, you have the option to take a more restrictive approach to provide extra protection. In this case, you may choose to allow only specific merchants that you know do not sell items that would be out of compliance, and block purchases with all other merchants. This approach provides less independence for beneficiaries, but it can be a good option for some.
While we can’t advise you on compliance with a specific trust, our Customer Support team is always happy to help you adjust the Spending Settings to achieve the right balance of protection and independence for your beneficiary. We encourage trustees to consult with their legal professional as needed and to regularly review and adjust the Spending Settings to align with changes in regulations or the beneficiary’s circumstances.