Able Accounts and How Tey Can Support Your Loved OnesMillions of families rely on public benefits to provide for their loved ones who have disabilities.  While these resources can help cover basic expenses, in most cases, they will not be enough to provide for all of their needs sufficiently.  These benefits are also income sensitive meaning that a recipient is severely limited in the amount of assets and income they are permitted to keep.  Fortunately, families in this situation have the option of using a specialized account to supplement their loved one’s income without endangering their public benefits.  Here is what you need to know about ABLE accounts and how they can support your loved one:

ABLE Accounts

ABLE Accounts are tax-free savings accounts which can be used for individuals with qualifying disabilities.  In Michigan, they are called Michigan Achieving a Better Life Experience (MiABLE) accounts. The beneficiary of the account is the owner and will not be taxed on any income which it generates.  The account holder and their friends and family can contribute to the account. An ABLE account holder can save up to $100,000.00 and add up to $14,000.00 per year without impacting their SSI, SSDI, and Medicaid as well as other public benefit programs.

Qualifying for an ABLE Account

In order to be eligible to set up an ABLE account the account holder must be an individual with significant disabilities who became disabled on or before their 26th birthday and is eligible to receive Supplemental Security Income (SSI); is eligible to receive Social Security Disability Insurance (SSDI), or has been diagnosed by a qualified physician with a physical or mental disability resulting in marked and severe functional limitations which are expected to last no less than 12 months.

Expenses Which an ABLE Account Can Cover

ABLE accounts can be used to pay for a person’s “qualified daily living expenses.”  This coverage is intended to extend to the costs incurred by someone living with a disability.  In addition to other IRS approved expenses, the account can ordinarily encompass healthcare costs, vocational and employment training, housing, transportation, personal support and care, and specialized equipment needed to assist them in their daily life.

Planning for a loved one with a disability can be complicated.  However, with the advice of an experienced special needs planning attorney you can take steps to ensure your loved one will have what they need today and in the future.  We have experience helping families prepare for their future using MiABLE accounts and other measures.  Contact us online or by phone if we may be of assistance.

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