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ABLE Accounts: Now people with disabilities don’t have to live like paupers

Posted by Anthony Serra | Nov 26, 2018 | 0 Comments

Coins in a jar

If you are caring for someone with a disability, you know the importance of government benefits like Medicaid and SSI (Supplemental Security Income). However, like many government programs, Medicaid and SSI are “means-tested” which means that you are only eligible for these benefits if you have limited resources. This discourages people from saving money and being more self-sufficient.

The good news is that this is no longer the case in New Jersey since now you can set up what's called an ABLE account (ABLE stands for Achieving a Better Life Experience). The ABLE account gives those with disabilities the ability to save, while preserving their important SSI and Medicaid.

Who's eligible?

To open an ABLE account, you must meet the following requirements:

  • Your disability was present before the age of 26; and
  • You are eligible for SSI or SSDI because of a disability.

You must self-certify that you have one of the following:

  • Blindness as defined by the Social Security Act (SSA); OR
  • A medically determinable physical or mental impairment with marked severed function limitation that has lasted, or is expected to last, at least 12 continuous months or result in death;
  • AND you must have a written disability-related diagnosis signed by a physician.

You must re-certify as to your disability annually.

How much can you save?

You can save up to $100,000 without exceeding your SSI/Medicaid resource limit. Only the amount OVER the $100,000 is counted against your limit, along with assets held in non-ABLE accounts.

If your account exceeds the $100,000 limit, you risk losing your SSI benefits. However, you will continue receiving Medicaid benefits regardless of your account balance. Of course, the idea is to spend some of the money in this account for "disability related" expenses so as to avoid exceeding the $100,000 limit.

How to open an ABLE account?

Opening an account is simple. Here is a link to how you can do this. This can be done right online and without the help of an attorney.

ABLE accounts can take the place of a Special Needs Trust

An ABLE account is a very simple and convenient way to build up a modest amount of assets without having to set up a Special Needs Trust which can be a costlier alternative. ABLE accounts can also be used in case a person receives a financial gift or inherits a modest amount of money. The only draw back is the $100,000 cap. For resources in excess of $100,000, a Special Needs Trust may still be required in order to preserve means-tested benefits.

About the Author

Anthony Serra

Tony Serra is a passionate advocate, especially for the elderly, disabled and those of modest means who need the services of an experienced and caring attorney. For more than 30 years, Tony has been helping common, everyday folks navigate their way through life's turbulent waters. Through innovation and utilizing modern technology, Tony and his law firm are now able to offer quality legal services that at one time were prohibitively expensive, at a fraction of the cost. If you need basic legal services, such as a Will, Power of Attorney, Living Will, Special Needs Trust, real estate transactions, uncontested guardianship pleadings and much more, please visit our website and our SMART LAW legal services platform. You will be pleasantly surprised by what we offer and glad you did! Tony is also an experienced mediator and founder of the Conflict Resolution Center of NJ. Tony has specific training in family matters as well as elder law and contested guardianship and estate cases.  


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