Updates to the ABLE Act

Updates to the ABLE Act

What is the ABLE Act? The North Carolina Achieving a Better Life Experience (ABLE) Act was signed into law in 2015. The ABLE Act enables individuals with special needs or their families to open savings accounts that do not count as assets (within stated limits) when determining eligibility for Medicaid, Supplemental Security Income (SSI), or other government benefits. These savings accounts are intended to cover qualified disability expenses for the individual with the disabling condition. This may include housing, transportation costs, assistive technology, job training, and more. The IRS determines which expenses qualify. Who is eligible to open an ABLE account? The ABLE Act has two criteria that must be met: The disabling condition must have occurred prior to age 26. The savings account may be opened after that age, but the disability must have existing prior to the 26th birthday.The individual must be considered disabled based on criteria set by the Social Security Administration (SSA). If he or she already receives SSI or SSDI payments and meets the age criteria, then approval is automatic. If not, then self-certification of disability is possible, but it would be advisable to have a medical doctor sign a letter certifying the individual does meet the functional requirements outlined by the SSA. ABLE Act Limits for 2019 In general, the current annual contribution to an ABLE account from all sources is $15,000. If the account beneficiary works and his/her employer does not contribute to a retirement plan, then the individual may contribute employment earnings over and above the $15K (with limitations). If the individual receives SSI and the ABLE balance exceeds $100,000, SSI...
Providing for a Loved One with Disabilities

Providing for a Loved One with Disabilities

By David Inabinett, Attorney Anyone can become disabled at any time, and when it’s a child or loved one, you can feel like your life has turned upside down. For parents with a child who will need a lifetime of care, I often hear the question, “What will happen when I’m gone?” It’s important to begin planning for your child’s (or other loved one’s) long term care as soon as possible. Update your wills and estate plans to include details regarding your child’s care, naming a person you trust as guardian (note you can name a separate guardian for financial matters or to manage a trust for your child). In August of 2015, the ABLE Act (Achieving a Better Life Experience) was signed into law. This legislation enables individuals with disabilities or families of those with disabilities to create savings accounts to cover their long-term care expenses. In the past, the monies in these accounts counted as assets when determining eligibility for services such as Medicaid. The ABLE Act allows individuals to accumulate up to $100,000 in savings (there are annual contribution caps, too) toward future care without impacting eligibility for government support. While the ABLE Act is a great step forward, long-term care for those with disabilities can be extremely expensive. Individuals and families with the means to provide more should still consider establishing a special needs trust. There are several types of trusts available, depending on how the trust will be funded. A trust set up for a child may differ from that set up for a disabled parent or sibling who owns assets. When set up...
Caring for a Loved One with Special Needs

Caring for a Loved One with Special Needs

The attorneys at Brinkley Walser wish to share this information with anyone who may be caring for a child or parent with special needs, or who may be facing separation and divorce where one spouse is suffering from a disabling condition. Based on U.S. Census figures from 2010, 18.7% of the country’s population exhibited some form of long-term disability. The disabling conditions consisted of sensory disabilities, physical limitations, mental and emotional conditions. The percentage of those disabled increased with age. The study showed 15.4% of those age 15 and older had a severe disability; for those ages 65+, that number was 36.6%. Statistics from a survey conducted by MetLife, Inc. showed that nearly 9% of parents reported of having a child (including adult children) with a “physical, developmental, cognitive, medical or emotional condition. ” According to this survey, the following information bears consideration: 49% are covered by some form of private insurance 41% are covered by Medicaid 8.5% of children with special needs have no form of health insurance coverage Parents spend an average of $326/month on non-covered medical expenses 60% of children with special needs require some type of medical intervention or administration of meds on a daily basis On average, parents of children with special needs spend 24 hours/week caring for their child, with 32% of such parents reporting they spend more than 40 hours/week providing such care 84% of parents with children having special needs have made no provisions for lifetime financial assistance for those children 88% of parents whose children have special needs have not established a special needs trust to maintain public benefits eligibility...