Title

Does the ABLE Act enable the wealthy and disable the poor?

Document Type

Article

Publication Date

2016

Department

Marketing

Abstract

The Achieving a Better Life Experience (ABLE) Act of 2015 establishes 529A plans which provide special needs individuals with a new option to plan for their financial needs. In the past, advisors would use first- and third-party special needs trusts (SNTs) for the financial planning needs of those with disabilities. Although the resources under the ABLE Act are important, this article suggests that the ABLE Act is not a replacement for traditional SNTs and could inadvertently create unintended situations where lower net worth individuals are subject to a regressive "death tax" that provides less, rather than more, assets for the benefit of the intended beneficiary.

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