Establishing a Special Needs Trust for SBP - New Checklist Now Available

The Howard P. "Buck" McKeon National Defense Authorization Act for Fiscal Year 2015 (FY15 NDAA), Public Law 113-291, amended Title 10, U.S. Code, Sections 1448, 1450, and 1455. This amendment gave military members and retirees the option to make a direct payment of a Survivor Benefit Plan (SBP) annuity for a dependent child to a Special Needs Trust (SNT).

A SNT is a legal instrument specifically designed for the benefit of a person with a disability. In some cases, this may preserve the beneficiary’s eligibility for other federal or state benefits. There is now a helpful checklist that details eligibility, required documentation, and methods you can submit your SNT request. See our webpage, https://www.dfas.mil/sbpsnt to download the new SNT checklist.

Eligibility Requirements
To be eligible to elect the option to cover the SNT under SBP, the member or retiree must have previously elected Spouse and Child or Child Only coverage for a disabled child under the SBP. There must also be an established and certified SNT. Establishment of the SNT is a legal process that needs to be coordinated with an attorney and is independent of DFAS.

Who May Make the Election and Effective Dates
If the member is alive and if they have previously elected Spouse and Child or Child Only coverage under the SBP, they may make the designation to make a direct payment on behalf of a beneficiary to an SNT at any time. After the death of a member or retiree, if the member or retiree had elected Spouse and Child or Child Only coverage under the SBP, any surviving parent, grandparent or court-appointed legal guardian may make the designation on behalf of a beneficiary. The election to make a payment on behalf of an SBP beneficiary to an SNT is irrevocable.

Please note: Regarding Spouse and Child coverage, if an eligible spouse exists at the time of the retiree’s death, the annuity will be payable to the spouse. The annuity will only be payable to the child if the spouse becomes ineligible. For additional information on updating SBP beneficiaries visit https://www.dfas.mil/changesbp.

Required Documentation
•    A written statement of the decision to have the annuity paid to the SNT
•    Attorney’s Special Needs Trust Certification available at https://www.dfas.mil/sbpsnt
•    Name and tax identification number for the SNT by (or before) the time your beneficiary applies for their annuity
 
Submit certified Special Needs Trust documentation to DFAS using the askDFAS online upload tool: https://www.dfas.mil/askdfas
 
OR
 
by mail to:
Defense Finance and Accounting Service
U.S. Military Retired Pay
8899 E 56th Street
Indianapolis, IN 46249-1200

OR
by fax to: 800-469-6559
 
Additional Special Needs Trust Assistance
It is important that you examine your child's needs and how any additional income may impact them with and without a trust. There are attorneys who specialize in this area and are qualified in assisting you to explore your options. Your installation's Exceptional Family Member Program (Military and Family Support Office) and the Legal Assistance Office can provide advice and referrals to local attorneys who specialize in special-needs laws. You can also visit https://www.militaryonesource.mil/family-and-relationships/special-needs, an official Department of Defense website, or speak to a special needs consultant at Military OneSource at 800-342-9647.

Note: The information on this website is provided to explain typical situations regarding retiree and annuitant benefits. For details and exceptions, please see applicable laws, financial management regulations, and instructions.
 

Page Updated Mar 26 2025