Coordinating an ABLE account and a special needs trust

Document Type

Article

Publication Date

2023

Department/School

Health Sciences

Publication Title

Journal of Financial Service Professionals

Abstract

When leveraged properly as part of a coor- dinated long-term portfolio, an Achieving a Better Life Experience (ABLE or 529A) ac- count and special needs trust (SNT) can allow an individual with disabilities to maximize savings above the government resource limit (currently $2,000 for an individual) without losing eligibility for U.S. government ben- efits. This article analyzes recent literature, policies, statutes, and litigation concerning special needs planning matters to create stra- tegic guidance for financial planners who are considering combining an ABLE account with an SNT. Financial planners should address eight key concerns to determine whether it is in a client’s best interests to utilize an ABLE account in tandem with an SNT: (1) eligibility; (2) annual contribution limits; (3) cumulative balance limits; (4) total funds available after account setup fees; (5) total funds available after account administration and/or mainte- nance fees; (6) Medicaid Estate Recovery fac- tors; (7) spending requirements/goals; and (8) state-based investment options.

Comments

A. M. Kelly is a faculty member in EMU's School of Health Sciences.

L. B. Hershey is a faculty member in EMU's Department of Marketing.

Link to Full Text

EMU Library Accessibility Request

Share

COinS