Previously in this space I told you that the federal government had enacted the ABLE Act and we were waiting for New Jersey to enact its own version of the ABLE program. The law is known as Achieving a Better Life Experience (ABLE) (S-313, HR-647) and was signed into law by the President Obama on December 14, 2015. The States have to adopt their own implementing programs, though. New Jersey’s law (S-2770) was signed by the Governor on january 11, 2016. Well, now you can provide for your disabled loved one by setting up the ABLE account through an Ohio program called STABLE. The site is http://stableaccount.com/
Here are the basics. An ABLE account can be established for a qualified disabled person, That means their disability was diagnosed or documented as occurring before the individual was 26 years old. Unlike a first-party special needs trust, contributions to the disabled person’s ABLE account can be made by anyone. There is a $14,000 per year year per donor, and it is a tax-deductible gift. A person can only own one ABLE account, and it cannot exceed $100,000. Social Security has already issued its rulings that this amount will not be counted as a disqualifying asset for the SSI program. As for Medicaid, the fund would be excluded as a resource, the State Medicaid program can require that it be able to recover against this asset, just as it could against other excluded or unavailable resources after the death of the Medicaid recipient.
The account has to be spent on qualified disability expenses, which include things like transportation, assistive technology, education, housing, employment support and training, health care, financial management and administrative services, legal fees, funeral and burial expenses.
We will contin ue to provide you with updated information about this new program that could provide a measure of economic independence for people with disabilities.
For advice on Medicaid and special needs planning, call for an appointment … 732-382-6070