What Are ABLE Accounts and How They Work With Special Needs Trusts?

Maybe your child with unique needs in Rexburg is getting closer to adulthood, and you are starting to think about long-term support. Maybe a family member in Coeur d’Alene received a settlement, inheritance, or backpay, and now everyone is wondering how that money could affect SSI or Medicaid. 

For many Idaho families planning for a loved one with disabilities, two tools often come into focus: ABLE accounts and special needs trusts. Each serves a different purpose. Sometimes one tool is enough, but many families find they work best together as part of a larger plan. The important step is understanding how each one works and where it fits.

What an ABLE Account Does for Families in Idaho

An ABLE account is a tax-advantaged savings account for an eligible person with a disability. Idaho launched its own ABLE Savings Plan in 2026 through the STABLE program, allowing eligible Idahoans to save and invest for disability-related expenses while maintaining access to certain public benefits. 

Eligibility generally depends on a disability that began before age 46. The account belongs to the person with the disability, although a parent, guardian, or other authorized person can manage the account if the beneficiary cannot do so independently.

Funds can be added to an ABLE account by the individual, friends and family, a supplemental needs trust, or a 529 qualified tuition plan. These accounts have a limited annual contribution, which is typically changed yearly. In 2026 the contribution is limited to $20,000, with the ability for the owner of the account to contribute more through wages. 

ABLE funds can be used for a wide range of qualified disability expenses, including:

• Education
• Housing
• Transportation
• Health care
• Employment support
• Assistive technology
• Basic living expenses
• Legal or financial services related to the disability

For SSI purposes, up to $100,000 in an ABLE account is typically excluded from the program’s resource limits. Medicaid eligibility can also continue even if the ABLE balance grows beyond that level and temporarily affects SSI payments.

This flexibility is one reason many families use ABLE accounts for everyday disability-related costs. Find more information on ABLE programs here: Nationally and Idaho-wide.  

What a Special Needs Trust Does

A special needs trust is another planning tool that allows assets to be held for the benefit of a person with disabilities without automatically disqualifying them from programs like SSI or Medicaid.

Instead of the beneficiary owning the funds directly, the assets are managed by a trustee. The trustee uses the funds to improve the beneficiary’s quality of life in ways that public benefits may not cover. Families often use special needs trusts when:

• A loved one is receiving an inheritance
• A personal injury settlement needs protection
• Parents or grandparents want to leave financial support for a child with disabilities
• Long-term financial management is needed

There are several types of special needs trusts that may be used depending on the circumstances:

• First-party special needs trusts: These are funded with the beneficiary’s own assets, such as settlement proceeds or backpay from benefits.
• Third-party special needs trusts: These are funded by family members or others who want to set aside assets for a person with disabilities.
• Pooled trusts: These are managed by nonprofit organizations that administer funds for multiple beneficiaries while keeping each person’s account separate.

How ABLE Accounts and Special Needs Trusts Work Together

Families do not have to exclusively choose between an ABLE account and a special needs trust.

An ABLE account can provide convenient access to funds for qualified disability expenses and everyday needs. A special needs trust can hold larger assets and provide long-term management through a trustee.

For example, parents in Meridian might establish a special needs trust as part of their estate plan while also maintaining an ABLE account to cover ongoing expenses for their adult child. A family in Pocatello might protect settlement funds inside a trust but transfer smaller amounts into an ABLE account for routine spending.

When used together, these tools can provide flexibility while still protecting eligibility for important programs. Find a more in-depth comparison here. 

Looking Ahead With an Idaho Estate Planning Attorney

At Alan R. Harrison Law, families work through the Collaborative Legal Planning Process™, which focuses on understanding each family’s situation before documents are drafted. The goal is to create a coordinated plan that protects benefits, supports independence where possible, and prepares for the future.

When You Are Ready, Reach Out to Our Idaho Estate Planning Firm

If you are trying to understand whether an ABLE account, a special needs trust, or both make sense for your family, Alan R. Harrison Law can help. We work with families across Idaho to create plans that protect benefits, support loved ones with disabilities, and prepare for the future with care and intention.

‍Reach out today to start planning today for tomorrow’s success.