Saturday, April 24, 2010

Henson Trusts

A Henson trust (sometimes called an absolute discretionary trust) is one designed to benefit disabled persons by protecting ensuring that the assets of a disabled person can still be used to their benefit without compromising their right to collect government benefits and entitlements. This is done by ensuring that the trustee’s discretion in the operation of the trust is absolute, even to the extent of whether or not the trust assets are used (and, if used, to what extent) to provide assistance to the beneficiary. Such a power means that the assets do not vest with the beneficiary and thus cannot be used to deny means-tested government benefits. There are also possible income tax relief elements because of taxation at a lower marginal rate. They are also sometimes used to shield assets from matrimonial division in case of divorce of the beneficiary. In most cases, the trust assets are immune from claims by creditors of the beneficiary. Henson trusts can operate as either living trusts (i.e. for the benefit of the beneficiary when you are still alive) or as a testamentary trust (i.e. for the benefit of the beneficiary after your death).

Further information can be found in this paper:
"What Can You Do To Enhance The Quality of Life For a Family Member with a Disability: Consider a Henson Trust",
a document produced by Reena, (“a non-profit social service agency dedicated to integrating adults with developmental disabilities into the mainstream of society”) and The Law Foundation of Ontario:
"What Can You Do To Enhance The Quality of Life For a Family Member with a Disability: Consider a Henson Trust".
a document produced by Reena, (“a non-profit social service agency dedicated to integrating adults with developmental disabilities into the mainstream of society”) and The Law Foundation of Ontario:
Henson Trust