California is considering a new type of savings account that may help those with disabilities build up resources without threatening their needs based benefits from subsidy programs. These accounts are known as ABLE accounts, which stands for "achieving better life experience." The accounts are only available to select individuals, but offer some great advantages to those who qualify, and may help those who suffer with a disability build up some resources for later in life.
In broad strokes, the state sponsored accounts are only available to those who already have eligibility for Social Security Income (SSI) benefits because of a disability they received before the age of 26. Those who choose to use the accounts can only have one account at any given provider, and must use the funds within the account to pay for qualified disability expenses. These may include living expenses, housing or education, among others.
These accounts are not intended to replace special needs trusts, but, used properly with careful planning, can work well in tandem with a special needs trust to provide for a disabled individual for years to come without jeopardizing any subsidy benefits. According to current guidelines, each account can take in $14,000 per year and hold up to $100,000 without threatening SSI benefits. California is currently considering sponsoring these accounts later this year.
If you believe that you or someone you love may benefit from an ABLE account, you can find out more about them and how to properly provide for someone living with a disability by contacting an experienced estate planning attorney. With proper guidance, you can create a plan to make the most of your resources and subsidy programs to create a high-quality standard of living for a person with a disability.
Source: Lake County News, "Estate Planning: Achieving better life experience accounts," Dennis Fordham, July 08, 2017