I haven't looked at this much, but on the surface I'm not seeing the benefit, especially for middle class. The only tax break I'm seeing is the earnings in the account are tax free if used for the intended purpose. Say grandparents are well off and put 14K into an account for their disabled grandchild. If the grandchild then uses it, would not that count as funds provided for their own support and possibly exclude parents from claiming them as a dependent based on 1/2 support test? Seems if the parents are middle income it would be better for the grandparents to gift the amount to the parents with an understanding that it's to help with the grandchilds expenses. Am I missing something?
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Rather than have these disabled folks be basically required to be impoverished to have government benefits, these accounts can be funded up to $100,000 and not be a dis-qualifier for benefits such as SSI and Medicaid. Think of adults who are disabled and will be able to accumulate funds for special expenditures in their future.
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Originally posted by New York Enrolled Agent View PostRather than have these disabled folks be basically required to be impoverished to have government benefits, these accounts can be funded up to $100,000 and not be a dis-qualifier for benefits such as SSI and Medicaid. Think of adults who are disabled and will be able to accumulate funds for special expenditures in their future.
I knew someone here would have looked at it in more detail than I have. Thanks.
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Originally posted by kathyc2 View PostI haven't looked at this much, but on the surface I'm not seeing the benefit, especially for middle class. The only tax break I'm seeing is the earnings in the account are tax free if used for the intended purpose. Say grandparents are well off and put 14K into an account for their disabled grandchild. If the grandchild then uses it, would not that count as funds provided for their own support and possibly exclude parents from claiming them as a dependent based on 1/2 support test? Seems if the parents are middle income it would be better for the grandparents to gift the amount to the parents with an understanding that it's to help with the grandchilds expenses. Am I missing something?Always cite your source for support to defend your opinion
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