Special Needs Trusts

Special Needs Trusts are irrevocable trusts with specific provisions designed for beneficiaries who receive, or will likely receive, public assistance. The purpose of a special needs trust is to “supplement” any state or federal services, without disqualifying the beneficiary from receiving these benefits in the process. To do so, the beneficiary must have no control over the trust assets, and have no right to receive income or principal from the trust. In situations when a person with special needs has or receives assets that will disqualify them from public assistance, these assets may be placed into a self settled "OBRA" (aka Payback) trust, or an Illinois ABLE account. The drawback of OBRA trusts and ABLE accounts is “clawback”, meaning, at the beneficiary’s death, the state will reimburse itself for any funds spent on the beneficiary’s care from before any funds can be distributed to other family members.