The Washington post describes proposals for tax-free savings accounts for the disabled:
Several pieces of legislation have been introduced in Congress to create tax-free savings accounts for people with disabilities....The Post sees a potential danger:
Although they differ in some details, these measures would allow parents, other family members or those with disabilities themselves to put money into special accounts; the savings would grow tax free and would not be taxed when withdrawn to pay for qualified expenses.
The account proposals provide that money deposited in the accounts not count against eligibility. The trick is to permit parents to provide some extra help for children with disabilities without encouraging wealthy people who could easily pay for health care and other needs to sock away large sums in these accounts while moving family members onto government benefits.Of course, the wealthy can already take full advantage of "special needs trusts". There is no reason these accounts would need to be more generous than existing special needs trusts, either in terms of how much they can hold or the circumstances under which money may be paid out, save perhaps for a cap on tax-exempt contributions. With a decent law, people who lack the resources or sophistication to engage in special needs planning will simply be able to open a statutorily defined disabilities savings account, and get a similar set of benefits to those already enjoyed by the wealthy.