How our trusts are different, similar and complementary to the new Ohio STABLE Accounts

With the passing of the Achieving a Better Life Experience (ABLE) Act and the implementation of STABLE Accounts in Ohio, it is important for people with disabilities and their families to understand the differences and similarities between STABLE accounts and the Pooled Disability Trusts offered by the Disability Foundation.  The main factors to compare and contrast the two involve who qualifies, the amount of money the accounts can hold, who can contribute to the account, and on what types of expenses the money can be spent.

The ABLE Act was passed to take into consideration the extra costs of living with a disability or caring for a child with a disability, therefore, the money in a STABLE Account must be spent on “Qualified Disability Expenses.”  This includes education expenses, housing (including rent, mortgage payments, property tax, utilities, etc), transportation, employment support, health prevention & wellness, and other miscellaneous disability expenses.  Disability Foundation Pooled Trusts may pay for anything considered a “supplemental need” as defined by social security.  This includes most of the items also acceptable for STABLE Accounts, with the exception of housing needs, i.e. rent, utilities, property insurance.  Supplemental needs also include a wide variety of other expenditures that STABLE accounts do not allow, such as recreation and entertainment.

Disability Foundation Pooled Trusts, the 2014 Ohio Community Pooled Flexible-Spending Trust (OCPFST) and the Ohio Community Pooled Annuity Trust (OCPAT) are slightly different in that they are held and administered by the Pooled Trust (i.e. the Disability Foundation). Laws permit a non-profit organization to create a trust which can bring together a Pool of assets of many individuals with disabilities in a way that protects each one’s assets and income from being counted in determining eligibility for certain public benefits, such as SSI or Medical Assistance.

A beneficiary of a STABLE Account can allow anyone to contribute funds to the account, as long as the annual total contribution does not exceed $14,000.00.  Also, if the account total exceeds $100,000, it will be subject to the $2,000 asset limit set by social security.  At this point, benefits will be suspended until the account is again below $100,000.  There are no such limits to funds with a Disability Pooled Trust through the Disability Foundation.  With both of the Disability Foundation pooled trusts, a parent, grandparent or someone ordered through the Court may contribute as much per year as they choose and are not limited to a total of $100,000.

In regards to fees, there are no setup fees for a STABLE Account, but an individual must open the account with at least $50.00.  There is a $2.50 monthly fee, plus an asset-based fee of between 0.19% and 0.34%, depending on the specific investment selections he/she makes for him/herself.  There are 3 asset allocations through a Vanguard account and 1 through Fifth-Third Bank. With the two trusts offered by the Disability Foundation, there are no set up fees associated with Ohio Community Pooled Annuity Trust (OCPAT), but the suggested fund minimum is $5,000 to establish the trust.  The fees are a percentage of Market Value determined annually by the Disability Foundation Board.  For the Ohio Community Pooled Flexible-Spending Trust (OCPFST), the setup fee is $1,000 and the annual fee is $250.

To qualify for either a STABLE Account or a special needs trust in Ohio, there is no age limit or requirement.  However, for a STABLE Account, the individual must have been disabled before the age of 26.  There is no such requirement for a special needs trust.

One key difference between a STABLE account and a special needs trust through the Disability Foundation is the method through which the fund is established and maintained.  A STABLE Account is established and managed entirely online, whereas a Disability Foundation trust is established and maintained through contact with the staff of the Disability Foundation.  While the convenience of online management will appeal to some, others will prefer direct contact with someone to answer their questions as they arise case by case, as is the case with the Disability Foundation trusts.

For some families, a combination of a pooled trust and a STABLE Account might be a good option.  For example, a family may choose to fund a STABLE Account, during the lifetime of the Donor, while entering into a Testamentary (A testamentary trust is a trust which arises upon the death of the testator, and which is specified in his or her will) with the Disability Foundation, as funds from an estate would most likely exceed the $14,000/year limit of the STABLE accounts.

If you should have specific questions about the benefits of both options, you may visit the Ohio ABLE Accounts website at www.stableaccounts.com or you may contact Kevin Hayde, Executive Director of the Disability Foundation, at (937) 225-9939.

How our trusts are different, similar and complementary to the new Ohio STABLE Accounts






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