Able Accounts
I recently learned of a great new program for clients who have loved ones with disabilities. They are called ABLE accounts, and often have the state name listed with ABLE if you were to search for them. For example, California’s program is called a CalABLE account. The ABLE stands for “Achieving a Better Live Experience”.
Traditionally, many individuals with disabilities and their families rely upon public benefits for income, health care, food, and other assistance. Many of the public benefit programs have income limitations for eligibility, ie: you have to remain poor. With the creation of ABLE accounts, public policy now recognizes that there are sufficient costs related to living with a disability. These accounts allow disabled individuals pay for qualified disability-related expenses without affecting their eligibility for government assistance programs.
To become eligible for an ABLE account, an individual must have become disabled before turning 26 years of age. If you meet the age requirement and are also receiving SSU and/or SSDI you are automatically eligible to create an ABKE account. You are not limited to creating an ABLE account only if you are under 26, you just need to have become disabled before your 26th birthday.
As of 2023, a family member may put $17,000 into an ABLE account. The amount is adjusted yearly to account for inflation. It was $16,000 last year. Per https://www.irs.gov/newsroom/able-accounts-a-valuable-financial-solution-for-people-with-disabilities certain individuals can make additional contributions based upon the lesser of their compensation for the year or their state poverty limit.
https://duckduckgo.com/?q=able+account+annual+contribution+limit&atb=v314-1&ia=web
Qualified disability expenses include housing, education, transportation, health, prevention and wellness, employment training and support, assistive technology and personal support services. The litimus test is “does the expense improve the health, independence, and/or quality of life for the beneficiary.
As of January of 2022, there were 49 ABLE plans nationwide.
https://www.calable.ca.gov/about
If you would like more information about these accounts, please reach out to our office and we will help you with these plans.
