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ABLE Accounts

  • By:The Law Center for Social Security Rights

The ABLE Act allows individuals who were deemed disabled before the age of 26 to save money in specific accounts and not jeopardize SSI or Medicaid services. Before The ABLE Act was passed, an individual collecting SSI could not save more than $2,000 or else they would lose all their benefits

ABLE accounts allow families to set aside money (up to $15,000 per person annually), and pay no taxes on that money’s growth as long as it’s used for qualified expenses. A “qualified disability expense” means any expense related to the designated beneficiary as a result of living a life with disabilities. These may include education, housing, transportation, employment training and support, assistive technology, personal support services, health care expenses, financial management and administrative services and other expenses which help improve health, independence, and/or quality of life.

  • The beneficiary of the account is the account owner, and income earned by the accounts will not be taxed. Contributions to the account, which can be made by any person (the account beneficiary, family and friends), must be made using post-taxed dollars and will not be tax deductible for purposes of federal taxes.
  • Under current tax law, $15,000 is the maximum amount that individuals can make as a gift to someone else and not report the gift to the IRS (gift tax exclusion).
  •  The first $100,000 in ABLE accounts would be exempted from the SSI $2,000 individual resource limit.

To read more about ABLE accounts, visit the MIAble website at:  https://www.miable.org/

Posted in: SSI, Uncategorized