After quickly moving through the U.S. House and Senate, the Achieving a Better Life Experience (ABLE) Act was signed by the President last week, creating the opportunity for individuals with disabilities to open savings accounts without the risk of losing Social Security and Medicaid benefits. These tax-exempt accounts are available for people with disabilities that had an onset prior to 26 years of age.
Contributions to ABLE accounts may be made by the account owner, family, and friends, but will be limited to $14,000 per year. Money from the accounts must be used for disability-related expenses such as housing, employment, and education.
Similar to 529 College Savings Plans, ABLE accounts will be developed and implemented at a State level. States will be able to begin creating their ABLE programs after the Treasury Department releases regulations anticipated to be complete by the end of 2015.
For more information on the ABLE act, please review the summary released by the National Disability Institute or contact your INARF office.