Special Needs Trust vs. ABLE in Florida (2025)

When planning for a loved one with special needs, Florida families must carefully consider the best way to preserve eligibility for public benefits while saving for future needs. A Special Needs Trust Florida and an ABLE account both serve this purpose—but work differently. Understanding their distinctions—and when to use one or both—can make a significant difference in effective, long-term planning.

What Is an ABLE Account?

An ABLE account (Achieving a Better Life Experience) is a tax-advantaged savings vehicle for individuals whose disability began before age 26. Contributions grow tax-free, and distributions for qualified disability expenses—like housing, transportation, education, or assistive technology—are also tax-free. In 2025, contributions are capped at $19,000 per year, matching the federal gift tax exclusion. If the beneficiary earns income and meets conditions, additional contributions may be allowed. An ABLE account remains accessible and easy to manage, often controlled by the beneficiary or their representative.

What Is a Special Needs Trust?

A Special Needs Trust is a legally structured trust designed to hold funds on behalf of a person with disabilities without jeopardizing eligibility for means-tested benefits like SSI or Medicaid. There are two primary types:

• First-Party Trust: Funded with the beneficiary’s own assets (e.g., inheritance, settlements). At the beneficiary’s death, remaining funds must repay the state for Medicaid expenses.

• Third-Party Trust: Funded by others (e.g., parents or grandparents). Remaining funds can pass to heirs as specified—no Medicaid payback required.

SNTs are irrevocable, require legal setup, and can cover a broader range of expenses that enhance quality of life without affecting public benefits.

Key Differences at a Glance

Feature	ABLE Account	Special Needs Trust (Florida)
Eligibility	Disability onset before age 26 (expanding soon)	No age restriction; trust established by another party or self
Annual Contribution Limit	~$19,000/year (2025)	No limit
Total Caps	Moderate account maximum (varies by state)	No legal cap
Impact on SSI/Medicaid	Up to $100,000 exempt from SSI; beyond may affect benefits	Funds generally excluded, preserving eligibility
Control	Beneficiary can manage funds directly	Trustee manages funds; beneficiary protected
Setup Cost & Complexity	Low — open online	Higher — requires attorney, trust agreement
Medicaid Payback	Florida may require payback upon death	Applies to first-party SNT only; not third-party

When to Use Each—and When to Use Both

Use an ABLE account when:

• You need a simple, low-cost solution.

• Contributions will remain under annual and total limits.

• Funds are intended for day-to-day expenses like therapy, transportation, or supplies.

• You want the beneficiary to have independence in managing funds.

Use a Special Needs Trust when:

• You’re dealing with larger sums (e.g., inheritance, settlements).

• You require total flexibility for enhanced life expenses.

• You need professional management to ensure funds aren’t misused.

• You want to designate beneficiaries for leftover funds (in third-party trusts).

Use both together when:

• You want to combine the independence of an ABLE account with the flexibility of an SNT.

• For example, fund an ABLE account for daily, self-managed needs, and reserve the trust for larger or future expenses that benefit from trustee oversight.

Florida-Specific Considerations

• Florida law does not require Medicaid payback from ABLE accounts—unlike many states—making it a particularly attractive option here.

• Florida allows relatively high lifetime ABLE limits (several hundred thousand dollars), though SSI eligibility may be affected if balances exceed certain thresholds.

• ABLE eligibility age limits are set to expand in 2026, enlarging access for more Floridians.

• SNTs must be carefully drafted under Florida statutes to ensure they remain compliant and do not inadvertently cause benefit disqualification.

Final Thoughts

When deciding between a Special Needs Trust Florida and an ABLE account, the right answer depends on amounts, needs, and desired control. For many families, a blended strategy—using an ABLE account for routine expenses and an SNT for larger or more strategic planning—provides the strongest, most flexible outcome.

Call to Action

At Absolute Law Group, we help Florida families design tailored special needs planning strategies. Whether you’re establishing an ABLE account, drafting a Special Needs Trust, or need both, our experienced team ensures your loved one is supported both today and long into the future. Contact us for a consultation to create the right solution for your family.