March 23, 2017

ABLE United Key Question Series: What happens if the individual passes away?

ABLE United Key Question Series: What happens if the individual passes away?

In this blog series, we’re highlighting the top five questions our customer service team mostly frequently receives. In this final blog post, let’s discuss:

What happens to the funds after the beneficiary passes away?

The beneficiary of an ABLE United account is the individual with the disability and the owner of the account. They may have someone oversee the account as an administrator, such as a parent, guardian, or an authorized individual under power of attorney. Regardless of who is administering the account, it’s important to note that outstanding qualified disability expenses, including funeral and burial, can be paid after death of the beneficiary.

If the beneficiary was not receiving Medicaid benefits, the funds in the account would be included in the beneficiary’s gross estate for federal estate tax purposes.

Effective July 1, 2018 through June 30, 2019, if the beneficiary was receiving Medicaid benefits, except as required by federal law, the Florida Medicaid program may not file a claim for Medicaid recovery of funds in an ABLE account. Funds in the ABLE account must first be distributed for qualified disability expenses then transferred to the estate of the designated beneficiary or an ABLE account of another eligible individual specified by the designated beneficiary.  Federal law requires that each state recover Medicaid expenditures from a Medicaid recipient’s estate under certain circumstances. For more information on Medicaid estate recovery in Florida, visit Florida’s Estate Medicaid Recovery program here.

We recommend contacting ABLE United at 1-888-524-ABLE (2253) if you are aware that an ABLE account holder has passed away.

Thank you for following this blog series on common questions. We hope the information provided has been helpful and has given you a better understanding of ABLE United.