End of Trust

[Cosmo10]

What is the name of your state (only U.S. law)? Massachusetts

My father is the Grantor and sole Beneficiary of a 20 year irrevocable trust. The trust was created in 1996 and will end in April of this year. At the present time there are no Remainder Beneficiaries. One of my siblings is the Trustee and, in an effort to prevent family interference and challenges to his performance, he has convinced Dad to not exercise the Special Power of Appointment clause which allows the Grantor to name Remainder Beneficiaries.
I am seeking clarification and guidance with the following clause in the trust: Disposition on Trust Termination: On trust termination the Trustee shall pay the then remaining trust property to the Remainder Beneficiaries if living, and otherwise shall pay the remaining trust property to the beneficiaries' estate.
There is an excellent chance that Dad will outlive the trust! Upon termination of the trust, and in accordance with the Disposition Clause, will he be required to exercise his Special Power of Appointment if he wishes his children to receive any of the assets that remain in the trust? If not, what happens to the remaining trust property?

 

[justalayman]

What do you think will happen to it?

If there are no remainder beneficiaries, barring something else in the instrument directing the remainder elsewhere, the remainder will revert to your father. Nobody else has any right to the assets of the trust.

 

[Cosmo10]

What do you think will happen to it?

If there are no remainder beneficiaries, barring something else in the instrument directing the remainder elsewhere, the remainder will revert to your father. Nobody else has any right to the assets of the trust.

My dad is in a long-term care facility and is receiving Medicaid (MassHealth) benefits. My speculation is that upon termination of the trust he will have to sign a Disclaimer to avoid exceeding the allowable financial limit for MassHealth benefits. My layman's guess is that at that point Dad will need to exercise the Special Power of Appointment clause, whether or not the Trustee approves.
If the remaining assets cannot revert to him, where else could they go?

 

[justalayman]

Is he even mentally competent at this time?


It's his money both as the grantor and sole beneficiary. You can't disclaim your own money. If he does add a residual beneficiary he will get it then either Medicaid will get it or Medicaid will require he pay for his healthcare.