Thanks to a new law passed in Congress last month, disabled individuals will no longer have to choose between saving a small nest-egg for future care expenses or preserving long-term eligibility for low-income benefits such as Medicaid or Supplemental Social Security Insurance (SSI).
Under the Achieving a Better Life Experience (ABLE) Act, individuals with disabilities now have the opportunity to begin saving their own money toward future health-care costs, housing expenses, transportation, education, and other needs without jeopardizing eligibility for critical government benefits.
Eligibility under the ABLE Act is limited to those 26 and under, with a $14,000 cap on yearly contributions. A total of $100,000 tax-free can now be accumulated in a special ABLE account, which is limited to one per person.
Prior to the passing of the ABLE Act, individuals with disabilities were unable to have assets totaling more than $2,000 or earn more than $680 per month without forfeiting eligibility for government programs like Medicaid. This was worrisome for families, considering that Medicaid is often the only healthcare option available for those with significant disabilities.
To protect such benefits, then, parents of disabled children would often go to great lengths to avoid putting assets, donations or inheritances their child’s name. But now, under this law, families have new opportunities to help their child save for the future while keeping much-needed government benefits intact.
Additionally, the ABLE Act offers another exciting benefit in that disabled individuals will no longer be deterred from pursing gainful employment opportunities in the local community.
Prior to the passing of this law, individuals who had some capacity to work and contribute to society were often deterred from doing so out of fear of they would cross the income thresholds of their benefits and lose everything. Now, young people with disabilities can take a chance in pursuing meaningful work opportunities without sabotaging their financial future.
As an Atlanta special needs attorney, I feel this is a wonderful law and a positive step forward in empowering disabled children and young adults. An ABLE Account combined with solid planning tools such as Special Needs Trusts now affords families with even more protection and flexibility when saving for the future. A good special needs attorney can help families utilize these tools for maximum savings opportunities and peace of mind.
Special needs planning attorneys in Atlanta have very specialized knowledge that can help families plan for their children’s future. There are so many things to keep straight when it comes to raising your special needs child, and focusing on what will happen to him or her after your death is not something that is pleasant to contemplate. Still, it is very important to take the time to meet with a special needs planning attorney in Atlanta in order to give your child the best opportunities.
An Important Tool
Special needs planning is a part of estate planning, and one of the most common things an Atlanta GA special needs atttorney is likely to advise will be a “special needs trust.” The reason that this trust is so important is that it allows you to set aside money for your child’s future without jeopardizing his or her eligibility for government benefits such as Social Security and Medicaid. Unfortunately, leaving your child even a small inheritance can make it so he or she is no longer eligible for this kind of aid and can severely impact quality of life.
Trusts for Your Child
There are different types of trusts that the attorney will go over with you. Some are funded by the person with special needs, say through an award from a personal injury case or from an inheritance. Others are specifically funded by a third party such as parents or other family members. The second kind is the special needs trust, and if it’s the right choice for you, a qualified Georgia special needs trust attorney will be able to help you understand your options with the trust.
People to Consider
In addition to helping you set up the trust, a special needs attorney will also be able to help you determine the appropriate trustee. In some cases, this may be a family member or other caregiver. In other cases, the lawyer or firm may take care of the administration of the trust. An advocate may also be chosen. This person will be familiar with both the beneficiary’s needs and the intentions and wishes of the person creating the special needs trust.
Using the Trust
When the trust is set up, the person creating it (called the “grantor”) has a say in how the funds are to be used. For example, money can be dedicated to the daily needs of the beneficiary. Dispersal schedules can be created, as well. In this way, rather than giving someone a single lump sum, you can set up a situation where monthly allotments are made. The advocate would understand this and work with the trustee to make sure the terms were being followed in the beneficiary’s best interest. At the same time, the trustee is charged with managing the funds through investments or other means that keep the trust funded.
Of course, this is just an introduction to the possibilities of a trust. For a much fuller understanding and to get the ball rolling, we invite you to contact our Atlanta special needs attorneys who are knowledgeable about the field, as well as how Georgia’s state laws come into play. To schedule a Georgia Treasures Planning Session (valued at $750) at no charge, simply call 770.425.6060 and mention this article.