Should I Create an "ABLE" Account as Part of My Maryland Estate Plan?

 Posted on October 08, 2024 in Estate Planning

Estate planning is an interesting field of law. It is a way for you to plan for something that can happen in the future that you would probably rather not think about. However, if you have plans, everything can be more accessible and smoother if that scenario you would prefer not to focus on actually happens.

It is similar to signing a prenuptial agreement as you plan your wedding and dream about your marriage during a time when you would rather not think about how you might end up getting a divorce. Planning now for a time in the future when you might become incapacitated can be uncomfortable, but it is wise to make these arrangements when you are capable of doing so. Many people even find that once they have gone through all the hard work of creating an estate plan, they feel an enormous sense of relief because the difficult decisions are made and everything is in order.

All of this planning becomes even more pressing for parents of children with disabilities. Parents worry about who will take care of their children after they are gone, physically and financially. There are several options available for ensuring certain protections for people with special needs in an estate plan. This article will examine one such option, known as an ABLE account. If this is something you would like to explore, an experienced Bethesda, MD, estate planning lawyer can offer guidance.

What Is an ABLE Account?

In 2014 passage, the federal Achieving a Better Life Experience (ABLE) Act to ease financial burdens for individuals with disabilities was passed. One of the results of this legislation is the ability to create an ABLE account, which is a special type of savings account specifically meant for people with disabilities and their relatives. This type of account offers various tax benefits and allows the owner or beneficiary of an account to save and invest money without endangering their eligibility for government benefits and disability assistance programs. The account is meant to supplement Medicaid, SSI, and other benefits instead of replacing them.

Who Is Eligible for an ABLE Account?

ABLE accounts offer many benefits, but not everyone is eligible to open one. Eligibility for opening an ABLE account in Maryland is dependent on several factors. They need to:

• Have a significant disability that began developing before they turned 26
• Have a doctor attest to their expectation that the condition will last for at least 12 more months
• Be a resident of the state of Maryland
• Be eligible for government benefits like Social Security Income (SSI) or Social Security Disability Insurance (SSDI).

Schedule a Free Consultation with a Silver Spring, MD Estate Planning Attorney

If you have a child with disabilities and you want to set up future financial protection for them, speak with a Potomac, MD, estate planning lawyer about whether opening an ABLE account would be a wise choice. With the tax advantages, asset protection, and flexibility they offer, many families find ABLE accounts to be a convenient way to ensure their loved one’s financial stability in the future. However, every family is different, and not every option suits everyone’s needs. At The Eleff Law Group, we are passionate about helping families find solutions that serve their best interests. Call us at 301-857-1990 to schedule a free consultation.