The phone call usually comes from a parent in their fifties or sixties. There is an adult child at home, or in a group home, or in supported employment, and the parent has finally started thinking about what happens when they are no longer there to manage things. The question they bring is some version of the same one: how do we leave something for our son or daughter without taking away the benefits that pay for their care?
It is the right question. And the answer is not “leave them money in your will.”
At Naperville Law Offices, we work with DuPage County families on the planning that protects a disabled child or adult while keeping the public benefits they rely on intact.
Why a Regular Inheritance Doesn’t Work
The programs most adults with significant disabilities depend on are means-tested. SSI cuts off at $2,000 in countable resources. Medicaid eligibility ties to the same kind of threshold. HUD subsidies, day-program funding through the Illinois Department of Human Services, and other supports all rely on the recipient staying below specified asset limits.
So an inheritance, even a modest one, becomes a problem rather than a help. A $40,000 bequest from a grandparent might cover six months of supplemental care, after which the recipient is over the SSI limit, off Medicaid, scrambling to restore eligibility, and worse off than they were before. Families who learn this the hard way usually wish someone had explained it earlier.
What a Special Needs Trust Actually Does
The structure is straightforward in concept. The trust owns the assets, not the beneficiary. A trustee — a sibling, a professional fiduciary, sometimes a corporate trustee — manages those assets and uses them for the beneficiary’s benefit. Because the beneficiary does not own anything, the trust assets do not count against benefit eligibility.
What the trust pays for is the supplemental piece — the things government programs don’t cover. A vacation. A specialized wheelchair upgrade that Medicaid won’t approve. A therapeutic horseback riding program. Adaptive technology. Replacement furniture. Travel to visit a sibling out of state. Pizza on a Friday night that the group home menu doesn’t include. The trust fills the gap between what daily life costs and what public benefits actually provide.
The Funding Source Determines the Structure
Whose money goes into the trust matters more than most families realize. Two main paths exist, and they work differently.
When parents, grandparents, or other relatives put their own assets into a trust for a disabled family member, the result is a third-party trust. These have no payback obligation. When the beneficiary eventually passes away, whatever remains in the trust goes wherever the people who funded it directed — usually to other family members or charity.
When the disabled person’s own assets fund the trust — say, a personal injury settlement, an inheritance that was not rerouted in time, or a back award of Social Security benefits — the rules tighten. These first-party trusts must include a provision repaying the state for Medicaid benefits paid during the beneficiary’s lifetime, before anything remaining can go to family. The federal statute authorizing these arrangements is technical, but the practical point is simple: the source of the funding shapes everything downstream.
For smaller amounts that don’t justify a stand-alone trust, Illinois families can use pooled arrangements run by nonprofit organizations. Each beneficiary has a separate sub-account, but the funds are invested together for efficiency. This option fills a real need for families whose disabled relative receives a modest settlement or inheritance.
Where ABLE Accounts Fit In
Illinois ABLE accounts add a useful tool to the planning toolbox. Authorized under the federal Achieving a Better Life Experience Act, these accounts let qualifying individuals save up to a certain annual amount without affecting SSI or Medicaid eligibility. ABLE accounts work alongside trusts rather than replacing them — they handle smaller, more immediate spending while the trust holds the larger long-term resources.
Services We Provide
The work in this practice area includes:
- Third-party trusts funded by parents, grandparents, and extended family
- First-party trusts holding the beneficiary’s own assets
- Pooled trust enrollments with Illinois nonprofit administrators
- Illinois ABLE account setup and integration with trust planning
- Adult guardianship petitions in the DuPage County Probate Division
- Plenary, limited, and short-term guardianships under Illinois law
- Age-18 transition planning, when a parent’s legal authority over their child ends
- Letters of intent — non-legal documents describing daily routines, preferences, medical history, and personality for whoever takes over caregiving
- Settlement protection planning when an injury or disability claim is being negotiated
- Long-term trust administration
- Coordination with social workers, residential providers, and benefits specialists
Planning at Age 18 Is Often Overlooked
When a disabled child turns eighteen, the legal landscape changes overnight. Parents who have made every medical and financial decision since birth suddenly lack the legal authority to do so. Doctors stop returning their calls. Banks refuse to discuss accounts. Schools start dealing only with the now-adult student.
The fix depends on the young adult’s capacity. For those who can participate in their own decision-making with support, powers of attorney may be enough. For those who cannot, guardianship is often necessary — and the DuPage County Probate Division has specific procedures for guardianship of disabled adults that require careful preparation. Families benefit from starting this conversation when the child is sixteen or seventeen, not the week before the eighteenth birthday.
How We Approach the Work
Special needs planning produces longer attorney-client relationships than almost any other area of estate practice. The plan that starts when the child is twelve continues through high school transitions, through the guardianship petition at eighteen, through the parents’ own retirement and estate planning, and eventually through trust administration after the parents pass away. We see this as multi-decade work and approach it accordingly.
Contact Naperville Law Offices
If your family includes someone with a disability and the planning needs to be done — or redone — contact Naperville Law Offices for a confidential conversation about what fits your situation.