Understanding ABLE Accounts, Special Needs Trusts and Pooled Trusts

If you plan to use savings to pay for basic day-to-day costs such as food or shelter, an ABLE account is a great option. If you receive means-tested benefits such as SSI or Medicaid, paying for food or shelter from the account will not reduce or eliminate your monthly payments or medical coverage. Paying for food or shelter from SNT/PT funds will likely reduce or eliminate SSI payments. Most state Medicaid programs have no such reduction in benefits, but be sure to check your state’s rules. Recommended practice: deposit benefits into a bank account and pay rent, food and monthly expenses from the bank account. Then save the extra funds in the ABLE account.

If you plan to use savings as a way to pay for special needs, a trustee for a SNT or PT may approve special items, but cannot give the beneficiary cash; paying for food or shelter could result in a decrease in SSI benefits.

If you plan to use savings for qualified disability expenses which are items or services which enhance your health, independence or quality of life, you may want to use your ABLE account or talk to the trustee about using SNT or PT funds for the purchase. Review the Decision Guide, Determining Whether Something Is a Qualified Disability Expense (QDE), to identify the common categories of ABLE-qualified disability expenses.