ABLE Accounts and Michigan Special Needs Planning

by Michael Lichterman Esq. from Licherman Law:

In the flurry of new laws passed at the end of 2013, there was a law that provides additional options for individuals with special needs or disabilities.  The law is called the ABLE Act – the “Achieving a Better Life Experience” Act. It had overwhelming support from all political parties, something that is rare these days. As you might expect, I am not able to cover all the details one blog post, especially when much of the “nuts and bolts” of how ABLE accounts will work has yet to be figured out through the regulatory process.  So, I will attempt to summarize the act and some important considerations.

The ABLE Act recognizes that there are additional financial strains faced by individuals with disabilities and their families, including those in the Grand Rapids, Michigan area.  In short, the ABLE Act allows for individuals to utilize a tax-free, state-based private savings account, referred to as an ABLE account, for the care of people with disabilities. This ABLE account can be used to supplement government benefits for “qualified disability expenses” such as medical and dental care, education, employment training, housing, and transportation, while not disqualifying a disabled individual from governmental benefits. As a result of the ABLE Act, eligible individuals and families are now allowed to establish ABLE savings accounts that will not affect their eligibility for Supplemental Security Income, Medicaid and other public benefits.

The Able Act vs. The Special Needs Trust: Which financial tool is right for your family?

by M & L Special Needs Planning:
Financial planning for families with special needs is difficult under the best of circumstances. As parents of individuals with disabilities, we know that every one of our decisions has long-lasting ramifications that can have a huge impact on the quality of our children’s lives in the future. We also know that our choices now may mean the difference between our children living successfully, with financial independence, and watching them languish on wait lists, fighting to access benefits, services, living options, etc.
There are tools that families with special needs can utilize to help them financially prepare for the future. In our opinion, however, these tools aren’t nearly enough to help these families fill the gap between savings and expenses. The resource limits enforced by the government benefit programs – the current limit is $2000 – also makes it difficult for individuals to save. (Note: for more information about resource limits and government benefits, please click here.) In the past, the only legal way to save money without jeopardizing eligibility for these benefits was the Special Needs Trust. On December 19^th, however, President Obama signed the ABLE Act into law thereby providing individuals with disabilities with one more option to help them save – the ABLE account.
Since the ABLE Act became law, there has been a lot of chatter in the special needs community regarding which savings method – the ABLE account or the SNT – is the best option. It goes without saying that the more financial tools available for individuals with disabilities, the better. As each family has its own set of financial circumstances, however, there are cases where one of these tools may be more beneficial than the other. Please join us today as we examine the ABLE Account and the SNT, and provide you with an analysis of the pros and cons of each.

Planning a Future For a Child with Down Syndrome

Friends and family of children with Down Syndrome often find social networks like Facebook to be a wonderful forum in which to share information, interesting experiences with their children and, ultimately, to express their doubts and sometimes, even their insecurities about a myriad of issues. Recently, when viewing one such page, we came across an interesting question posed by the mom of a toddler with Down Syndrome called Ryder. While Ryder’s mother had already set up savings account for the future University and car expenses of her older children, she wondered how to plan financially for Ryder’s future. She said that she was unsure why she had not yet started a savings fund/established a special needs trust for him, and asked advice from followers of her page as to what steps they had taken – the answers were as swift as they were helpful.

Bill key to making us ABLE

by Charles H. Gerhardt III from Cincinnati.com:
Charles H. Gerhardt III is president and founder of Cincinnati-based Government Strategies Group and chairman of the National Down Syndrome Society.
Today and Thursday, a dedicated group of advocates from the Down syndrome community will descend on Washington, D.C., to attempt something that voters in America have implored our lawmakers to do – work in a bipartisan fashion to pass a bill that will benefit millions of Americans without costing taxpayers.
The bill, the Achieving Better Life Experience (ABLE) Act, was introduced on Nov. 15, 2011, and now has 240 co-sponsors in the House and 38 in the Senate. It will give individuals with disabilities and their families the ability to plan and save for their child’s future just like every other American family.
Current federal law prohibits individuals with certain disabilities from possessing more than $2,000 in assets, earning a monthly income of more than $674 or engaging in “substantial gainful activity” without risk of losing services that Medicaid and Supplemental Security Income (SSI) provide.
People with physical and intellectual disabilities want to work and care for themselves but often need the assistance that Medicaid and SSI provide. Americans are taught to work hard and save their money. Unfortunately, current law forces many to do just the opposite – don’t work and don’t save.
I have three children, two sons and one daughter. My daughter, Anne, happens to have Down syndrome. My wife and I try to treat our children the same, and, for the most part, we have succeeded. But in one area, we cannot. We established 529 college savings accounts for our sons’ education and, with luck, will have them funded. For Anne, we have no such account. In order to save for her, we have to establish a complicated and expensive special needs trust.
Technically, we have to keep her destitute in order to care for her best. It is just not fair, nor is it smart. I want nothing more than for Anne to have the opportunity for “substantial gainful activity.” The more productive Anne is, the less reliant on your tax dollars she will be.
Our goal this week is to convince Congressional leaders to include the ABLE Act in any legislative package that might get passed during this lame-duck session. Fifty national disability organizations support the act, from the National Down Syndrome Society to Autism Speaks. It has the potential to help millions of people and right an egregious wrong. It is important legislation that deserves to be passed now.
I, like most parents, want the best for my kids. Our journey became a little different after Anne was born, but all families face their own hurdles. With the help of Congress, we can eliminate one very large and unfair hurdle standing in the way of millions of Americans.