What is a third party Special Needs Trust?

An SNT is called a “third party” SNT when the funds going into the trust originally belonged to a person other than the beneficiary, such as a parent, grandparent, etc. With a third party SNT, there are no payback provisions to the state, so at the death of the beneficiary, the Trustee can pay any outstanding principal to whomever the original trust creator indicates, including other family members or not for profit agencies.