2026 Newsletter Q&A Spotlight

January 2026 Special Needs News and January 2026 Estate Planning & Elder Law News

QUESTION OF THE MONTH:

Q: I am fed up with going to my primary care doctor and feeling that he is rushing through a 10-minute exam. Is there a way I can get more personal service and still use my health insurance?

A: Yes, one way is to look into a high-deductible insurance plan which qualifies for a health savings account (HSA). Load up money (There are limits) in that account and pay for a Direct Primary Care Membership. These memberships allow you to have more personal time with a primary care physician who is on call when you need them. As of January 1, 2026, you can pay the membership cost from your HSA. (Kiplinger Personal Finance).

February 2026 Special Needs News

QUESTION OF THE MONTH:

Q: A client from Downers Grove said he wants to set up a special needs trust for his son but has heard they are complex and that it’s easy to make mistakes during the process. What are some common mistakes I should advise him to avoid?

A: I explained that special needs trusts are complex and that the following mistakes are important to avoid:

1. Not Consulting a Specialist:
   Failing to work with an attorney who specializes in special needs planning can result in errors during trust setup or non-compliance with applicable laws.
2. Choosing the Wrong Type of Trust:
   Selecting the incorrect trust—such as confusing a self-settled trust with a third-party trust—can jeopardize the child’s eligibility for government benefits.
3. Insufficient Funding:
   Underestimating the amount needed to properly support the child’s long-term needs may leave insufficient resources in the future.
4. Ignoring the Trust’s Language:
   Using vague, overly broad, or non-compliant language can lead to disputes, administrative problems, or mismanagement of trust assets.
5. Not Designating a Suitable Trustee:
   Appointing a trustee who lacks knowledge of special needs planning or public benefits can result in poor decisions that negatively affect the beneficiary.
6. Neglecting Regular Trust Reviews:
   Failing to update the trust as laws change or family circumstances evolve can reduce its effectiveness over time.
7. Overlooking Tax Implications:
   Ignoring potential tax consequences related to trust income or distributions may create unnecessary financial burdens.

Avoiding these common mistakes can help ensure the special needs trust effectively supports the child while preserving eligibility for essential government benefits. If the client has additional questions, I recommend discussing them with an attorney from our office.

February 2026 Elder Law News

QUESTION OF THE MONTH:

Q: A client from Oak Brook recently asked, “How can I protect my assets from potential long-term care costs?”

A: There are several strategies that may help protect assets from being depleted by long-term care expenses, including the following:

1. Asset Protection Planning: Developing a comprehensive plan that may involve transferring assets into exempt vehicles so they are not counted for Medicaid eligibility purposes.
2. Establishing a Trust: Creating an irrevocable trust can help shield certain assets from being considered available for long-term care expenses, while still allowing some degree of control over how those assets are managed and distributed.
3. Gifting Assets: Making gifts to family members or others can reduce countable assets; however, it is critical to consider Medicaid’s look-back period (typically five years), which may result in penalties if gifts are made too close to the time care is needed.
4. Evaluating Long-Term Care Insurance: Purchasing long-term care insurance may help cover the costs of nursing home care, assisted living, or in-home care, depending on the policy terms.

Because these strategies depend heavily on individual circumstances, it is advisable to consult with an attorney to evaluate specific goals, assets, and timing considerations and to develop a tailored plan.

February 2026 Estate Planning

QUESTION OF THE MONTH:

Q: In Illinois, who is entitled to receive a copy of a trust?

A: Under the Illinois Trust Code, individuals generally entitled to receive a copy of a trust include:

1. The Settlor:The person who created the trust typically has the right to receive a copy.
2. Trustees:Current trustees responsible for managing the trust are entitled to a copy.
3. Beneficiaries:Individuals named as beneficiaries of the trust are also entitled to receive a copy upon request.

If a beneficiary is a minor or otherwise legally unable to receive the trust document, their legal representative may obtain a copy on the beneficiary’s behalf.

March 2026 Estate Planning

QUESTION OF THE MONTH:

Q: Are there any life events that allow me to take money out of my 401(k) without incurring a penalty?

A: Yes. The following are some examples:

• Birth or Adoption: Each parent may withdraw up to $5,000 penalty-free within one year of a child’s birth or legal adoption.
• Unreimbursed Medical Expenses: You can withdraw funds to cover medical bills that exceed 7.5% of your adjusted gross income (AGI) for the year.
• Emergency Personal Expenses: Under the SECURE 2.0 Act, you can take one distribution of up to $1,000 per year for “unforeseeable or immediate” personal or family emergencies.
• Domestic Abuse Victims: Victims of domestic abuse can withdraw the lesser of $10,000 or 50% of their account balance within one year of the abuse incident.
• Terminal Illness: If a physician certifies that you have a terminal illness (typically expected to cause death within seven years), you may withdraw any amount penalty-free.
• Qualified Reservist Distributions: Military reservists called to active duty for at least 180 days can often take penalty-free distributions.
• IRS Levy: If the IRS levies your 401(k) plan to collect unpaid federal taxes, the 10% penalty does not apply to that amount.
• Federally Declared Disasters: You can withdraw up to $22,000 penalty-free if you suffer economic loss due to a disaster in a FEMA-designated area.

March 2026 Special Needs News

QUESTION OF THE MONTH:

Q: I am the trustee of a first party Special Needs trust when my son inherited monies outright from his great aunt. When he passes can I (or my successor) purchase a prepaid funeral before Medicaid is paid?

A: As the trustee of a first-party Special Needs Trust (SNT), you can purchase a prepaid funeral for your son, but it must be done while he is still alive.

Once the beneficiary of a first-party SNT passes away, federal law requires that the state Medicaid agency be reimbursed for all medical assistance paid during the beneficiary’s lifetime before any other expenses, including funeral costs, can be paid from the remaining trust funds.

April 2026 Elder Law News

QUESTION OF THE MONTH:

Q: A client emailed the other day stating that his mother is about to receive Medicaid benefits in a nursing home. According to Medicaid regulations, how much is she allowed to keep in her bank account?

A: Medicaid allows a single person to keep $17,500.00 in cash or other non-exempt assets while receiving long-term care benefits. If her spouse is still living in the primary home, the home may be transferred to the spouse and remain exempt, subject to certain equity limits. A car and prepaid burial contracts of up to $10,000.00 for each spouse are also exempt. Her spouse may also retain $143,172.00 in cash, investments, or other non-exempt assets.

April 2026 Special Needs News

QUESTION OF THE MONTH:

Q: I have heard about the Medicaid waiver program in Illinois. What services do these programs cover?

A: The Illinois Medicaid waiver program covers the following:

1. Home and Community-Based Services (HCBS): Provides support for individuals with disabilities so they can live independently at home. This program funds many of our clients who live in CILAs.
2. Supportive Living Program (SLP): Offers assisted living services for seniors who need help with daily activities. This is sometimes referred to as “Medicaid light” assisted living.
3. Medically Fragile/Technology Dependent (MF/TD): Assists children with complex medical needs in receiving care at home.
4. Developmental Disabilities Waiver: Supports individuals with developmental disabilities through a variety of services and programs.
5. Mental Health Waiver: Provides services for individuals with mental health conditions to promote recovery and independence.

Aging Waiver: Offers services to older adults to help them remain in their homes and avoid institutional care.

April 2026 Estate Planning

QUESTION OF THE MONTH:

Q: A client owns five apartment buildings in Chicago. Each apartment building contains a swimming pool and other recreational facilities. He wants to know the best way to protect his personal assets and the other buildings if a catastrophic event occurs at one of the properties.

A: I discussed with him the strategy of separating management from ownership. He could place each building in its own LLC and create a separate LLC to manage the buildings. Most negligence claims arise from poor management decisions—failure to maintain the property, failure to keep adequate personnel on the premises, and other negligent acts or omissions. Thus, because negligence is typically attributed to management, only the management LLC’s assets would be at risk. The buildings and his personal assets would be protected, assuming he operates each LLC lawfully and properly. However, in any commercial setting, adequate liability insurance is always the first line of defense.