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Navigating Tax Challenges of ABLE Accounts and Special Needs Trusts: Guidance for Elder Law Attorneys

Recording of a 90-minute CLE video webinar with Q&A

This program is included with the Strafford CLE Pass. Click for more information.
This program is included with the Strafford All-Access Pass. Click for more information.

Conducted on Thursday, November 7, 2024

Recorded event now available

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This CLE course will offer estate planning, special needs planning, and elder law attorneys guidance on navigating the intricacies of ABLE accounts and special needs trusts under current tax law, including the IRS final regulations for ABLE accounts. The panelist will review the impact of current tax law on the taxation of these critical planning tools, techniques for avoiding pitfalls in utilizing these planning tools, and their interplay with other planning strategies.

Description

ABLE accounts have provided critical planning tools for families who need to provide for the care and well-being of aging or disabled family members. However, the implementation of ABLE account programs at the state level exposed several limitations that the 2017 tax reform law corrects. Final regulations issued in 2020 provided additional clarity and guidance that significantly impact ABLE accounts and planning considerations.

ABLE accounts are tax-favored savings accounts set up under state ABLE programs allowing eligible individuals to make contributions to meet qualified disability expenses. On Oct. 2, 2020, the IRS issued final regulations guiding eligible individuals who are the owners and designated beneficiaries of ABLE accounts on various issues involving the requirements of Section 529A.

The final regulations explain the requirements a state ABLE program must satisfy to be considered a "qualified ABLE program" under Section 529A. They also outline recordkeeping and reporting, requirements for establishing an ABLE account, qualifications for eligible individuals and beneficiaries, and contribution limitations.

Elder law attorneys must understand the nuances and implications of ABLE accounts under current tax law in light of the final regulations to ensure that clients' goals are met and the use of ABLE accounts cooperates with special needs trusts to bolster care planning strategies.

Listen as Jennifer Marie (Jenny) McInerney, Attorney at McInerney Law Firm, discusses key tax issues for ABLE accounts and the interplay with special needs trusts, as well as how elder law attorneys can employ critical changes in these tools' tax treatment to offer strategic guidance to clients.

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Outline

  1. Overview of ABLE accounts
    1. Criteria for enrollment and contributions
    2. Benefits
    3. Limitations
  2. Impact of IRS final regulations
  3. Interplay with special needs trusts
    1. Self-settled
    2. Third party
    3. Benefits
    4. Limitations

Benefits

The panelist will review these and other noteworthy issues:

  • How are contributions to ABLE accounts and special needs trusts treated under the final IRS regulations?
  • What advantages are there for beneficiaries wanting to contribute income/earnings to special needs trusts and ABLE accounts?
  • What steps can families of aging and disabled clients take to ensure that the maximum benefit is derived from these planning tools?

Faculty

McInerney, Jennifer
Jennifer Marie (Jenny) McInerney
Attorney
McInerney Law Firm

Ms. McInerney's primary practice areas include Wills and Trusts, Special Needs Planning, Estate...  |  Read More

Access Anytime, Anywhere

Strafford will process CLE credit for one person on each recording. All formats include course handouts.

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