Assessing ABLE Accounts
With the passage of the Stephen Beck Jr. Achieving a Better Life Experience Act of 2014 (ABLE Act) individuals with disabilities may utilize tax-advantaged savings accounts, referred to as ABLE Accounts. The ABLE Account, is however, only one tool in a special needs planner’s toolbox. Due to various restrictions (such as the requirement that the individual must have been disabled prior to age 26 and funding limitations) and the Medicaid payback, these tools have limited use in special needs planning. When appropriate, the pros and cons of the various ABLE programs should be assessed before selecting which account will most benefit the individual with a disability. The ABLE National Resource Center (https://www.ablenrc.org/) is a resource designed to assist in comparing the various state ABLE programs so as to identify which program may best suit a client’s need*. Some information obtained from ABLE National Resource Center identifies some of the following important elements:
Different ABLE programs assess different fees. For instance, Virginia’s ABLENow program has no enrollment fee but there is a monthly $3.25 account service fee for all accounts with less than a $10,000 balance. Ohio’s STABLE program has a $6.75 quarterly fee for Ohio residents and a $9.75 quarterly fee for non-Ohio residents. In contrast, Attainable Savings Plan Accounts and Portfolios, which is the Massachusetts ABLE program, has no set fees, and instead imposes a Program Management fee (daily charge of .15% against Attainable Plan portfolio assets and 0.00 – 0.15% annually for Money Market portfolios) and State Sponsor Fee (.05% against Attainable Plan portfolio assets and 0.00 – 0.05% annually for Money Market portfolios), in addition to underlying Mutual Fund expenses.
Some programs have minimum contribution requirements, which are usually nominal. For instance, STABLE and PA ABLE, Pennsylvania’s ABLE program, both have a $25 initial funding requirement, while Florida’s ABLE United has a $5 initial funding requirement, and others have no set minimum. There may also be account contribution minimums. PA ABLE has a $25 minimum, while STABLE sets theirs at a $1.
Some programs are FDIC insured, such as ABLENow and STABLE, while others, such as Attainable Savings Plan Accounts and Portfolios, are not.
The various programs use different investment managers, and have different investment options. The number of different options also vary from program to program. The investment options for a single program appear to be below 10.
DEBIT CARD AVAILABILITY
Some programs offer debit card options, while others do not. Additionally, some programs, such as PA ABLE and Oregon’s ABLE for All program, charge a fee for this convenience.
OUT OF STATE ENROLLMENT
Not all programs are available to out of state residents. For example, ABLE United is not available to out of state residents.
*Disclosure Per ABLE National Resource Center: The ABLE National Resource Center does not manage or issue ABLE accounts directly. We work with state ABLE programs to ensure information contained in our tools and resources is updated regularly. We monitor these resources closely, but all information remains subject to change by individual state ABLE programs. For details about any state ABLE program, refer to the state’s plan disclosure documents.
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Shannon Laymon-Pecoraro is a Shareholder of Hook Law practicing in the areas of elder law, special needs planning, estate and trust administration, estate planning, asset protection planning, financial planning, guardianships, and conservatorships. Ms. Laymon-Pecoraro also works with plaintiffs who have been injured, and their trusted advisors, to advise on public benefits issues and developing trusts to protect settlements and verdicts. To date, she has completed over 250 personal-injury related trusts, specifically Settlement Protection Trusts and Special Needs Trusts, including those with Medicare Set-Asides.
Ms. Laymon-Pecoraro is certified as an Elder Law Attorney (CELA) by The National Elder Law Foundation (NELF). Approved by the American Bar Association and authorized by the Pennsylvania Supreme Court, the CELA certification is the legal industry’s “gold standard” for elder law and special needs practitioners. There are only about 500 CELA-certified attorneys nationwide.
Prior to joining the firm in 2012, Ms. Laymon-Pecoraro handled estate planning documents for members of the United States Department of the Army and has been involved in the legal representation of several large corporations.
- Elder Law
- Estate & Trust Administration
- Estate Planning
- Asset Protection Planning
- Guardianship & Conservatorship
- Long-Term Care Planning
- Special Needs Planning
- Financial Planning
- Personal Injury Settlement Consulting