Social Security SSI asset limit strategy - ABLE account vs. Special Needs Trust for adult son

I've managed both an ABLE account and Special Needs Trust for my daughter for years. Here's my take:ABLE account advantages:- You control it directly without trustee fees- Easy online transfers and management- Can be used for qualified disability expenses (housing, education, transportation, etc.)- Up to $16,000/year contributions (2024 limit)- First $100,000 doesn't count against SSI resource limitSpecial Needs Trust advantages:- No contribution limits- No spending restrictions (as long as trustee approves)- Can receive inheritance/life insurance proceeds- Lasts indefinitelyIf your son isn't accumulating huge amounts, the ABLE account is simpler and cheaper for day-to-day management. I'd recommend using the ABLE for regular overflow and keeping the trust for larger sums/inheritance planning.

Thank you, this breakdown is SO helpful! I didn't realize ABLE accounts had that $100k exemption for SSI - that would solve our immediate problem since we're nowhere near that amount. Do you find the ABLE account easy to manage? And did you have to provide documentation of his disability to open it?

we did both for my nephew!! trust is for big stuff and inheritance but ABLE is WAY easier for regular money. his ssA case worker actually told us to do the ABLE first before putting money in trust because its cheaper to manage and he can still use debit card from it for his own stuff which helps with independence. only downside is what happens when they die the medicaid payback thing

There's a common misunderstanding about the Medicaid payback provision with ABLE accounts. It only applies to funds remaining in the account after the beneficiary passes away, and only up to the amount Medicaid paid after the ABLE account was established. With proper planning and spending during the beneficiary's lifetime, this can be minimized. The special needs trust (depending on whether it's first-party or third-party) may also have Medicaid recovery provisions. It's definitely worth consulting with a special needs attorney to understand these nuances.

DONT USE THE TRUST!!!! My sister put money in her daughters trust and THE STUPID TRUSTEE charged her $4500 in fees last year!!! For what??? Moving money around?? ABLE accounts let YOU control the money not some banker making commission! The SSA doesn't care which one you use as long as the money gets out of his regular account to stay below $2000.

While I understand your frustration with trustee fees, it's important to note that not all trusts have such high fees. It depends on the trustee and how the trust is structured. Many family-managed special needs trusts have reasonable fees, especially if a family member serves as trustee. Both ABLE accounts and SNTs have their place in a comprehensive special needs financial plan.

I got so frustrated trying to call SSA about this exact situation last year. I was on hold for 3 hours and then got disconnected, TWICE! Finally used a service called Claimyr (claimyr.com) that got me connected to a real person at SSA in about 15 minutes. They have a video demo showing how it works: https://youtu.be/Z-BRbJw3puUThe SSA rep confirmed that both options work to stay under the $2000 limit, but they actually recommended the ABLE account for us because it was simpler to document and track. We've been using it for about 9 months now and it's been great! Much easier than dealing with the trust administration.

Thank you - this is helpful! I've been trying to get through to our local office for weeks with no luck. I'll check out that service. Did they explain if there are any downsides to using the ABLE account versus the trust? I'm concerned about making the wrong choice.

The SSA rep said the main difference is that ABLE accounts have that annual contribution limit (around $16,000-17,000) and can only accumulate $100,000 before affecting SSI eligibility. The trust doesn't have those limits. But for most people staying under those ABLE limits isn't an issue. They also mentioned that ABLE accounts are easier for them to verify during redeterminations since they're more standardized.

My son gets both kinds of benefits too and we did the ABLE account thing last year but I'm STILL confused about how to report it on the SSI redetermination forms? Does anyone know where it goes on the form? I'm scared of messing something up when they review his case next month.

On the SSI redetermination form, there's a section for resources/assets. You'll need to report the ABLE account there, but check the box indicating it's an ABLE account. You'll need to provide statements showing the balance. SSA will exclude it from counting toward the $2,000 limit. Make sure you keep good records of all deposits and withdrawals, especially if any withdrawals were for non-qualified disability expenses (which could potentially count as income for SSI purposes).

Thank u so much!!!! I was looking all over for this information!!

I'm a benefits counselor and work with families on this issue regularly. Here are some additional considerations that might help with your decision:1. If your son might eventually work (even part-time), an ABLE account lets him save earnings above the SSI resource limit without affecting benefits.2. For day-to-day management of excess funds, ABLE accounts are typically more cost-effective and simpler.3. The special needs trust remains important for larger sums, inheritance planning, and gifts from relatives.4. Consider using both tools strategically - they serve complementary purposes.5. Some states offer tax deductions for ABLE contributions, adding another benefit.6. Be aware that SNTs and ABLE accounts have different spending rules - ABLE funds must be for qualified disability expenses, while SNT distributions can't be for food or shelter without affecting SSI.As for which is better for regular deposits to stay under the $2,000 limit, the ABLE account is almost always the more practical choice for that specific purpose.

This is incredibly helpful information - thank you! I didn't know about the potential state tax deductions. I'm in Arizona - I'll have to look into whether we have any tax benefits here. Could you clarify one thing? I thought special needs trusts CAN pay for food and shelter, but it might cause a reduction in SSI benefits? Is that correct or am I misunderstanding how that works?

You're absolutely right - I should have been more precise. SNT distributions for food and shelter CAN be made, but they may trigger what's called

Thank you for clarifying! That's a really important distinction. I think we're going to open an ABLE account while maintaining the trust. The tax deduction is a nice bonus too!

My husband and I went through this exact situation last year with our daughter. We had the same question and ultimately went with the ABLE account for regular deposits while keeping the special needs trust for larger sums and future planning.One thing nobody mentioned yet - some ABLE programs offer debit cards that your son could potentially use himself (with supervision if needed). This promotes independence and life skills that the trust doesn't offer. Our daughter loves having \

The debit card is a fantastic point I hadn't considered! My son would definitely benefit from having some supervised independence with purchases. Thank you for mentioning that Ohio's program might be better - I had just assumed we'd use Arizona's without researching other states.

I tried opening an ABLE account online last month and the website was AWFUL!!! Kept crashing and wouldn't accept the documents I uploaded. Anybody else have trouble with this??? I gave up after three tries.

what state program were u trying? we used PA ABLE and it worked fine. my brother helped set it up tho cause im not good with computer stuff lol. maybe try a different state's program? they all have different websites

It was the California one. Maybe I'll try Pennsylvania's instead! Didn't know you could use different states.

My cousin has downs sindrome and gets both SSI and disabled adult child benefits like your son. We use both trust and ABLE but for different reasons. The ABLE is for day to day overflow money and the trust is for when my aunt and uncle pass away. Their lawyer told them its easier to move the excess $$ to ABLE every month rather than trust for small amounts. But everyone's situation is different and you should definitely talk to a special needs planner!

I'm an attorney who works with special needs planning, and I'd encourage you to think about this as using both tools rather than choosing between them. They serve different purposes in a comprehensive special needs plan:1. ABLE Account: Ideal for managing the month-to-month SSI resource limit issue. Low administrative costs, potential tax advantages, and easier access for qualified disability expenses.2. Special Needs Trust: Critical for larger sums, inheritance planning, and protection of means-tested benefits long-term.The most effective strategy I see with my clients is using the ABLE account for regular excess funds (transferring money as needed to stay under $2,000), while maintaining the SNT for larger financial planning. This combined approach provides both protection and flexibility.One important consideration: if your son receives Medicaid (as most SSI recipients do), be aware of potential Medicaid estate recovery issues with ABLE accounts after his lifetime. This is where having the special needs trust as part of your overall plan remains important.

Thank you for this professional perspective. We're definitely going to maintain both and use them strategically as you suggested. It makes sense to use the ABLE account for the monthly management and keep the trust for long-term planning. I appreciate everyone's input! This has been incredibly helpful in making our decision.