Who Can Be the Trustee of an Income Trust in Arkansas?
In Arkansas, the trustee of a Miller Trust (Qualified Income Trust) is whoever manages the trust account — depositing the applicant's income each month and paying out only what Arkansas DHS allows. Arkansas is unusually flexible on who serves as trustee: DHS's PUB-396 expressly allows the applicant to act as their own trustee, but advises planning for a replacement trustee in case the applicant can no longer serve — so choosing a relative, friend, or (when no relative is available) a bank as trustee or successor trustee is often the safer choice. The trust may be created by the applicant or by the applicant's child, spouse, sibling, attorney-in-fact/power of attorney, guardian, or Social-Security-appointed representative payee, and must be created on or after August 11, 1993. A trustee may serve without bond or court supervision. The trustee opens a single, separate bank account that holds only the applicant's income (kept apart from the account used for living expenses), makes only the monthly payments the caseworker authorizes on the DHS-712, delivers annual accountings to the settlor, files an annual fiduciary tax return for the trust, and on the settlor's death pays Arkansas DHS its remainder. No trustee fee may be charged for serving, and neither attorney fees nor tax-return-preparation fees may be paid from the trust — only the bank's service charges and, when a commercial institution serves as trustee, its commercially reasonable administrative fee. Confirm any complex situation with an Arkansas elder-law attorney. The trustee does not have to be a lawyer or a professional; for the core setup this is a role most families fill themselves. For a complex situation, consult an Arkansas-licensed elder-law attorney. This guide is informational only and is not legal advice.
What usually happens
You find the free Arkansas DHS form, and it looks simple. Then an elder-law attorney quotes $1,000–$2,500 to handle it. So you fill it in yourself, get it signed, and take it to the bank, where the branch has never opened one of these and says no.
Meanwhile the month is running out. In Arkansas, coverage can't start before the month the trust is funded, so a month that slips is another month of private-pay nursing care at $7,148–$7,711.
This applies when the person who needs care has gross monthly income over Arkansas's income cap of $2,982, whether you're their child, their spouse, or a professional helping them.
Free: the questions to ask an Arkansas bank before your first visit
6 questions for a five-minute phone call, so you find out whether a branch knows how to open this account before you make the drive. Emailed now, then 4 short follow-ups over the next 10 days — then we stop.
The trustee does not have to be an attorney or a professional fiduciary. Managing a Qualified Income Trust is an operational job, not a legal one: open the account, move the applicant's income through it each month, and pay out only what Arkansas DHS allows — the same short list of tasks every month.
What the trustee does each month
- Deposits the applicant's income — Social Security, pension, and any other named sources — into the dedicated trust account.
- Pays out only the amounts Arkansas DHS permits: typically the applicant's personal-needs allowance of $40/month, any spousal allowance, and the applicant's share of medical and care costs.
- Keeps simple records of what went in and what came out, so the trust stays compliant and Medicaid has no reason to question it.
Name a backup trustee
Many families name a successor trustee when they set the trust up, so that if the first trustee cannot continue, the trust keeps running without interruption. Either way the Arkansas setup is the same — see the step-by-step setup and what to say at the bank.
Whoever you name will need this
The trustee is the one who opens the account — and most banks have never seen this type of trust before. Free one-pager: the questions to ask before that first visit, emailed now. Then 4 more short emails over the next 10 days — then we stop.