ABLE accounts vs Special needs trust

[@MadOldMan-ck5wq]

Good morning could you please add this to the Fiduciary Security Allied Legal Professional Interdiction Trust Policy Protection Plan. To avoid document crime with NICER 837PC Global Network of Template Schedule Scenario Clauses A to Z Permission Validation Administration fiduciaries? So a counterfeit DPOA can’t steal it starting in July 2024?

[@eddywibowo3186]

My soon has already past 26 years old. Can he still open an able account.

[@ellencookman-EstatePlanningSNT]

Yes, as long as your son's disability manifested before age 26, he can apply for an ABLE account at any age

[@eddywibowo3186]

Hi Ellen, please advise in regard the special need trust on top my regular trust@@ellencookman-EstatePlanningSNT

[@ParMonSun]

I thought anything under 18k(this year) has a gift tax exclusion. Regardless if gifting to able account or snt, why would a 709 have to be filed for small amounts?

[@ellencookman-EstatePlanningSNT]

A gift to a SNT is not considered a “completed” gift, so the $18K annual exclusion (this year) doesn’t apply to gifts to SNTs, and the giver needs to file a 700 form. Compare this to a gift to an ABLE account, which is considered a completed gift directly to the beneficiary (even if someone other than the beneficiary is managing the ABLE account), so no 709 form is needed.

[@AdayHiwet]

Is giving money to my disabled daughter tax didactable?

[@ellencookman-EstatePlanningSNT]

In California, a gift to a disabled person or their ABLE account is not deductible for income tax purposes. In some other states, I have heard there might be income tax deductions for a contribution to that state’s ABLE account.

[@nightgalaxy-pz2bc]

How are distributions from a third party special needs trust to an ABLE account taxed? Would such a distribution from a third party special needs trust to an ABLE account be counted as income to the beneficary by Medicaid?

[@Sarah55512]

I live in Minnesota, can I set up able account for my special need son or only for those who live in CA?

[@ellencookman-EstatePlanningSNT]

Most states now have established their own ABLE accounts. I looked online and this looks like the Minnesota ABLE program: savewithable.com/mn/home.html

[@AshleySpeaks4U]

Every state.

[@c.m.303]

Choose any state you want, but MN is a nightmare! Fidelity offers an Able Account too. They have good security, and know how to handle money, and have good returns. They have been very efficient helpful and kind through all these mistakes from MN. MN is on their 4th attempt to transfer my account to Fidelity. No one knows what they are doing there, but they are sure they figured out this time...well, maybe next time... darn let's try again. Sigh. They make multiple errors on every step of the way. And on their third attempt, they filed out the check wrong!!! I'm not getting any updates on this current attempt yet. It would be funny if it wasn't so painful.

[@LizBeth_1]

What about the Federal and some states, estate tax that a successor is responsible for after death of the beneficiary?

[@ellencookman-EstatePlanningSNT]

For the SNT, after the beneficiary dies, if the trust assets remaining are higher than the estate tax exemption (which is $13.61 million now, going down to about $7 mm in 2026 - so this would be unusual!), the any estate tax exposure would be paid out of the remaining trust assets. For an ABLE account, the maximum amount it can be funded (in CA) is $529K, so estate taxes wouldn’t be an issue here.

[@cynderellacrenny]

What about inheritance while on SSI? If the child is the beneficiary of a retirement account, can they stay in that investment plan without it affecting their benefits?

[@c.m.303]

From my experience, it has to go into an irrevocable special needs trust, means the Trustee has full control over the money... that can be devastating for the disabled and apparentlyno oversight. I've heard of someone who used a pooled Trust through Lutheran brotherhood that was able to use the funds. Currently, 18,000 per year can go to an Able Account and the beneficiary has access to that. So at least part could go to the Able, and if your lucky, maybe the Trustee will move the max over each year. BUT these Trustees and state Able accounts sometimes don't have a clue how to handle money... see my post above. I'd recommend Fidelity Able Account they know how to get things done and are very professional, plus they have security. I was with MN Able and twice they offered me info without asking any verification. And even after that, the security process is weak. They also sound like kids who literally can't figure out how to write a check and get it in the mail. No training. They are on their 4th attempt to try and transfer my money to Fidelity.

[@c.m.303]

Oops, and yes, money in the Able Account, as long as it is used for the beneficiary doesn't affect benefits. Up to $100,000 if the person is on SSI, or much higher depending on the limit for the plan that they choose if they are on SSDI. The irrevocable Trust can have any dollar amount and not affect SSDI or medicaid benefits, but the beneficiary gets no say in how the money is handled or how it is used. It's basically given to the Trust who may or may not follow what's laid out in the document. I'm not sure if there's a limit if on SSI.

[@AshleySpeaks4U]

But...I'm not a child. 😢

[@c.m.303]

Did you become disabled before you were 26? If so you still qualify for Able. They will be raising that to 46 if I remember right.