by Diane Weinberg

This month’s Passionate Estate Planner continues our discussion of trusts used in special needs planning. In January, we looked at three types of special needs trusts commonly used to preserve assets for an individual with a disability while allowing that individual to qualify for public benefits: a self-settled (first party) special needs trust, a third party supplemental needs trust, and a community pooled trust.

This month, we are focusing on the trust accounts created under the Achieving a Better Life Experience (ABLE) Act, a new type of statutory special needs trust. Modeled after the Qualified Tuition Program (commonly known as a 529 Plan account), the ABLE Act allows a qualifying individual to create one ABLE account to accumulate cash while remaining eligible for public benefits, including SSI and Medicaid. All contributions to the account are aggregated and capped at a value equal to the annual gift tax exclusion amount for that year ($14,000 in 2015, adjusted for inflation in $1,000 increments). The account itself is also capped, and it may not hold more than the State limit for education-related 529 accounts ($235,000 in Georgia). In this video newsletter, we are going to provide an overview of the trust account created by the ABLE Act as well as discuss the role that these accounts will play in special needs planning. Perhaps the biggest finding as a result of the ABLE Act is the recognition that Qualified Tuition Program (529 Plan) accounts may also have a role in special needs planning, and we will briefly discuss this issue as well.

After the video, if you have additional questions or want to schedule an appointment to speak with Diane Weinberg about special needs trusts or about planning for special needs individuals generally, please call our office at 678-720-0750. Enjoy the February video presentation of the Passionate Estate Planner.