This case concerns the treatment of distributions from a self-settled special needs trust under 42 USC Section 1396p(d)(4)(A) for Section 8 housing purposes. The federal district court, E.D. Mass., held that all distributions are to be treated as income for Section 8 purposes. The 1st Circuit acknowledged the work of NAELA regarding regulation 5.603(b), which states that “income” in section 5.603(b) “does not include the principal that initially funded the trust.” DeCambre’s main claim focused on whether the housing authority made an error under relevant regulations when calculating her income. She argued that SNT monies were from lump-sum payments and thus any SNT distribution was excluded from her annual income. After again looking at the regulation and considering the parties’ arguments, the court rejected the defendant’s position. This is a victory for people with first-party pooled trust accounts or relatively modest individual SNTs.
Download PDF
(Adobe PDF File)