HEMS stands for Health, Education, Maintenance and Support. If your family has a trust, there's a strong chance those four words are inside it — and they generally decide what the trust can pay for. The exact language of the trust always controls, and similar wording can produce different results depending on the document, applicable state law, and the facts involved.
Here's why that matters. A trustee holds money for your children, and the HEMS standard is the rule they follow when deciding whether to write a check. Tuition? Usually yes. Rent? Probably. A wedding? Now it gets complicated.
Most families never discuss the standard. Not because anyone is hiding it, but because it's such ordinary language that it slips past without a conversation. It deserves one — because families who understand these four words are often better prepared to work with trustees, discuss expectations, and preserve the grantor's expressed intent.
This guide covers what each word means, who decides, what the standard usually won't cover, and the two things you can do about it.
The trustee decides. That's the part most families don't realize.
The distribution standard isn't a formula. It's a judgment, applied request by request. A trustee weighing a payment asks: does this fit health, education, maintenance or support?
And here's the harder truth: a trustee may say no even when the money is sitting right there. Having funds available is not the same as being permitted to release them. If a request falls outside the standard — or if paying it would cut against what the trust was set up to do — a careful trustee will generally decline. That isn't obstruction. It's the job.
It can cut the other way too. Where a request clearly falls inside the standard, a beneficiary may in some circumstances be able to ask a court to compel payment, though the outcome depends on the trust language, applicable state law, and the trustee's exercise of discretion.
Two reasons, both good.
Taxes. The tax code treats these four words as an ascertainable standard — meaning the trustee's power is measurable rather than unlimited. That distinction is what generally allows a child to serve as trustee of their own trust without the assets being included in their taxable estate, provided the document is drafted properly. Reword the standard carelessly and that treatment may be lost.
Protection. Because the trustee may only pay for certain things, trust assets are often harder for a creditor to reach than money sitting in a beneficiary's bank account. That protection is real, but it isn't absolute. How much protection a trust actually provides depends on the trust's drafting, applicable state law, the nature of the trustee's discretion, and the type of creditor claim involved — certain claims, such as child support or alimony, are commonly treated differently from ordinary creditors.
The tax regulations are more specific than most people expect.
Health. Medical, dental, hospital and nursing expenses are named directly in the regulations. Health insurance premiums are commonly treated as part of health as well, though this generally depends on the wording of the document and applicable law.
Education. The approved language is "education, including college and professional education" — so graduate and professional school generally fit, unless the trust says otherwise.
Maintenance and Support. The broadest of the four, and here's what surprises people most: under the tax regulations, support and maintenance are treated as synonymous — and neither is limited to the bare necessities of life.
The usual touchstone is the beneficiary's accustomed standard of living. Mortgage payments, property taxes, insurance and ordinary living costs generally fit. An established family vacation may qualify when it is consistent with the beneficiary's accustomed standard of living, but the answer depends on the trust language and the trustee's judgment. The purpose is generally to maintain a way of life, not to fund a substantially grander one.
This is where families are most often surprised.
The regulations indicate that a power to spend for a beneficiary's comfort, welfare or happiness, standing alone, does not qualify as an ascertainable standard. Also generally outside the line: distributions that meaningfully enlarge a beneficiary's own estate, and distributions funding extraordinary gifts to other people.
So when a trustee hesitates, they usually aren't being difficult. They're protecting the very treatment the trust depends on.
Can it pay for graduate school? Usually yes. The regulations specifically contemplate college and professional education. A doctorate, a second master's, or a program abroad may still depend on how the trust is written.
Can it pay for a wedding? Usually not under HEMS alone. A wedding is generally a one-time expense that doesn't clearly maintain a standard of living. Some trustees permit a reasonable contribution; many decline. If it matters to you, say so in the document.
Can it pay for travel? It generally depends on the pattern. Continuing a family's established vacation habits may fit. A trip far beyond anything the family has ever taken usually doesn't.
Can it pay for a house? Rent and mortgage payments usually fit. Buying a home outright is often harder, because it may enlarge the beneficiary's personal estate. A common approach is for the trust to buy the home and allow the beneficiary to live in it, though whether this is available depends on the trust language and applicable law.
Can it fund a business? Typically not under HEMS alone. Business capital does not ordinarily fall within health, education, maintenance or support, although the trust may contain separate authority permitting it.
Can the standard be customized? Yes, carefully. You can generally give the trustee guidance about what education means in your family, or what you'd consider reasonable. What you should not do is casually add words like "comfort" or "welfare" — those may jeopardize the tax treatment the standard exists to provide. If you want the trustee to have broader latitude, a common route is separate discretionary authority held by an independent trustee, rather than stretching these four words to cover more than they can. The right approach depends on the document and applicable law.
Trusts don't look the same everywhere. A US trust may be read by a trustee in one country, for a beneficiary living in another, about schools and doctors in a third. The four words may appear in a different form abroad, or not at all — and cross-border trusts raise tax and reporting questions well beyond the distribution standard. Local advice matters.
Add detail to the trust. Tell your attorney what education means in your family. Say whether health should include what insurance won't cover. Definitions written into the document are generally binding.
Write a letter of wishes. A plain-language letter that sits beside the trust, telling the trustee what you had in mind. It usually isn't legally binding — but a thoughtful trustee reads it first, because it's the only document written in your own voice. It costs nothing and takes an afternoon.
And if your trust is already signed, that isn't a problem. It's a conversation. Most families have never had it.
Think of these four words as your trust's compass. They won't answer every question — but they point the trustee toward the decisions you hoped they would make.
The clearer the standard, and the clearer the guidance you leave around it, the more likely your family will still hear your voice long after you're gone.
Which raises the only question that really matters: does your trust reflect your values, or merely transfer your assets?
KING GUIDE™ · Complex family wealth topics. Plain-English answers for better decisions. This guide is educational and is not individualized tax, legal or investment advice. Trust law, tax treatment, creditor protection and the interpretation of distribution standards vary by jurisdiction and change over time; cross-border structures raise additional considerations. Work with a qualified estate attorney, a tax advisor and a CFP® professional on your own circumstances.
