What is ABLE?

The more than 8 million individuals with disabilities, their families and those who support them. Learn more about how an ABLE account can help maintain and improve health, independence and quality of life.

History and Brief Definition of ABLE

In December 2014, Congress passed the Stephen Beck, Jr. Achieving a Better Life Experience Act, which added Section 529A to the federal tax code. This enables eligible individuals with disabilities to save money in a tax-exempt account that may be used for qualified disability expenses. This will allow qualified individuals with disabilities to save money while keeping their eligibility for federal public benefits.

The ABLE Act, considered by many to be one of the most significant pieces of legislation for the disability community since the Americans with Disabilities Act, had overwhelming bipartisan support in both the Senate and the House.

This law was the result of nearly a decade-long cross-disability grassroots effort. This effort originated with a group of parents of children with disabilities who recognized the unfairness of not being able to save funds in their child’s name for fear of losing essential benefits, benefits that allow their child to live independently in the community.

Topics at a Glance

How much can you save in an account?

The total annual contributions into an ABLE account by all contributors combined, including family, friends and the beneficiary themselves, for any given tax year is $15,000. The amount may be adjusted periodically to account for inflation. The total limit over time that could be made to an ABLE account will be subject to the individual state and their limit for education-related 529 savings accounts. Many states have set this limit at more than $300,000 per plan.

What is the impact on benefits: SSI, SSDI, Medicaid or other public benefits?

One of the most remarkable things about an ABLE account is that it allows you to accumulate more than $2,000 in assets without losing your federally funded means tested benefits. This includes SSI and Medicaid. Funds in an ABLE account are not taken into consideration when determining eligibility for these types of programs.

There is one exception, however, related to ABLE account holders that are also receiving SSI benefits. If you are receiving an SSI check, you will continue to do so until your ABLE account goes over $100,000. Since the annual contribution limit to an ABLE account is $15,000, it will take quite some time for ABLE beneficiaries to accumulate enough assets in the account to approach this $100,000 threshold.

Once an ABLE account exceeds $100,000, your SSI check will be suspended until such time as the account balance falls back below the $100,000 threshold. Although your SSI benefits may be suspended if you exceed the $100,000 threshold for an ABLE account, your Medicaid benefits will remain intact.

How many accounts can a person have?

The law prohibits any person from having more than 1 ABLE account at any given time.