Florida Estate Planning: What is an ABLE Account?
Under a federal law known as the ‘Achieving a Better Life Experience (ABLE) Act’, an individual with disabilities has the option to save money on a tax-advantaged basis while also preserving their eligibility for important government programs — including for Supplemental Security Income (SSI) and for Medicaid.
If you have a child or a loved one with disabilities, setting up an ABLE account for them can be an important part of creating a comprehensive estate plan that offers them real financial security. In this article, our Tampa estate planning attorneys provide an overview of the most important things you need to know about ABLE accounts.
Florida ABLE Account: Understanding the Basics
- A Savings Options for People With Disabilities
People with disabilities face a number of different financial challenges — including finding away to get true economic security while also maintaining eligibility for state and federal benefits. An ABLE account is a bank account that people with disabilities can use to save money, without it counting against them in eligibility calculations.
- Florida Has an ABLE Program in Place
The state of Florida was one of the very first jurisdictions in the entire country to put an ABLE program into place. Through ABLE United, Florida residents can open up a specialized bank account for a person with disabilities.
- There are Strict Federal Rules Regarding Eligibility and Deposits
To maintain ABLE eligibility, there are a number of strict rules and regulations that must be followed. First and foremost, these accounts are only available to people who developed a qualifying disability prior to their 26th birthday. Next, each person can only hold one account. Finally, there are maximum rules regarding how much can be deposited per year and how much can be held in the account. Though, you can deposit money on behalf of another person.
- ABLE Accounts May Be a Supplement to a Special Needs Trust
For many people who have children with disabilities, setting up an ABLE account is a supplement to establishing a Special Needs Trust. The money in an ABLE account can be accessed far more easily on a day-to-day basis.
That being said, there are strict limits regarding ABLE deposits. As such, you may not be able to use an ABLE account effectively to pass inheritance down to a loved one who has special needs. Fortunately, there are other estate planning tools available. By setting up a Special Needs Trust, you can give them access to financial security that they need and deserve, without endangering their government benefits.
Discuss Your Case With Our Hillsborough County Estate Planning Lawyers Today
At Bubley & Bubley, P.A., our Florida estate planning attorneys are diligent, committed advocates for our clients. We will work tirelessly to help your family put in place a plan that best meets your unique needs and circumstances. If you have questions about Florida ABLE accounts, special needs trusts, or any other related matter, we are ready to help. To arrange a fully private consultation, please contact our law firm today.