What Should You Do with Leftover Special Needs Trust Funds in Chicago, IL?

by | May 10, 2022 | Law Firm


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Managing a Special Needs Trust Fund in Chicago

Special needs trusts serve a valuable purpose when helping parents, family, or caregivers. These ensure disabled persons receive adequate support to cover medical and legal costs. However, if the recipient of a special needs trust passes away, what happens to the leftover funds? What should you do with leftover special needs trust funds? Each family’s situation will be different, so the decision will differ.

Agencies of the State

Most of the time, special needs trusts must meet certain regulations. Otherwise, they will not avoid being included as the beneficiary’s assets after death. As a result, using them may minimize tax liabilities as well as limit taxable income. Thus, they can make it easier to qualify for state programs, such as Medicaid.

Charitable Organizations

The trust grantor could choose to send the remaining funds to a charity if desired. If a charitable organization has helped your family, sending the funds to them may be a good option. Furthermore, sending the leftover funds to them can help a family cement their legacy.


Some families opt to divert excess funds to other disabled children. Since they can cost a lot to maintain, sending the fund to them can lessen the burden. If the individual who passed away had kids, they could be seen as inheritors, and you can send the funds to them.

Fund Donors

Sometimes, the people who donated funds to the trust may wish for them to be returned. If your special needs trust has generous donors, sending the leftover funds to them may be good.

What should you do with leftover special needs trust funds in Chicago, IL? Visit Life’s Plan, Inc. to learn more.

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