Why HEMS Matters
The IRS treats HEMS as an ascertainable standard. That means a beneficiary who serves as trustee of their own trust can make HEMS distributions without those assets being pulled into their taxable estate at death. It also blocks most creditors from forcing distributions, since they cannot demand more than HEMS allows.
What HEMS Covers
Health includes medical, dental, mental health, and long-term care expenses. Education covers tuition, room and board, books, and reasonable training programs. Maintenance and support cover the beneficiary's accustomed lifestyle, including housing, food, transportation, and basic living costs.
HEMS in Arizona Trusts
Arizona trusts routinely use HEMS for both lifetime and testamentary subtrusts. It balances flexibility with creditor and tax protection, which is why it remains the default discretionary standard.
Arizona Discretionary Trust Statute
HEMS distributions made by a beneficiary-trustee remain within the discretionary trust protections of A.R.S. 14-10504.