Chayet & Danzo, LLC Chayet & Danzo, LLC
Call for a Free Initial Consultation
Direct 303-872-5980
Toll-Free 888-472-1088
Email Us
Compassion, talent and dedication: guiding colorado families and Their Trusted Advisors During Times of Need

When Could ABLE Act savings accounts be available in Colorado?

The US Congress passed the Achieving a Better Life Experience (ABLE) Act in 2014. The law will enable people with disabilities to access savings accounts to pay disability-related expenses. The accounts will not affect Medicaid and Supplement Security Income eligibility.

Recently, the Internal Revenue Service released proposed regulations authorizing states to provide tax-favored ABLE accounts to people with disabilities. These new accounts will operate similar to 529 college accounts. They will not replace special needs trusts in estate planning, but could be another tool for families with a disabled child.

The general framework

Each state will set up its own program (referred to as 529A accounts). The disabled individual is the account owner and also its designated beneficiary.

Yearly contributions up to $14,000 (the current gift tax exclusion) can be made to the account. The 529A account can have a balance up to $100,000 without affecting SSI eligibility. A higher balance could result in suspended SSI benefits, but would not affect Medicaid eligibility.

What expenses can the account be used to pay?

Distributions to pay for qualified disability expenses would then be tax-free. These expenses are somewhat broad and include things that improve independence, health and also quality of life. Several examples include:

  • Assistive technology¬†
  • Housing
  • Employment training, support and education
  • Transportation

Colorado will need to pass new legislation before 529A accounts becomes available in the state. The earliest that this could happen is 2016.

To learn more about these accounts and how they may fit into a comprehensive estate plan, speak with an experienced estate planning attorney.

No Comments

Leave a comment
Comment Information

Watch Our Firm Video

We are the premier Elder Law firm in the Colorado region. We set ourselves apart from other law firms in the area with our talent, dedication, compassion and ability of our attorneys to handle any case in Elder Law. We serve Colorado families with experience and dignity in your time of need.

View More Videos

Denver Office
650 S.Cherry St., Suite 710
Denver, CO 80246

Toll Free: 1-888-472-1088
Phone: 303-872-5980
Fax: 303-355-8501
Denver Law Office Map

Edwards Office
105 Edwards Village Blvd.
Edwards, CO 81632

Toll Free: 888-472-1088
Toll Free: 1-888-472-1088
Fax: 303-355-8501
Edwards Law Office Map

Aspen Office
600 East Hopkins Avenue
Suite 301
Aspen, CO 81611

Toll Free: 888-472-1088
Toll Free: 1-888-472-1088
Fax: 303-355-8501
Aspen Law Office Map

  • Rated by Super Lawyers Macro Chayet
  • Rated by Super Lawyers Frank J. Danzo, III
  • Member National Academy of Elder Law Attorneys, Inc. TM
  • Avvo Rating 10.0 Superb Top Attorney Elder Law
  • 2015 Five Star Professional Wealth Manager Multi-Year Winner
  • Our new 2015 Medicaid Book: how to protect your Family's Assets from devastating nursing home costs
  • Proud Sponsor 2015-Denver Colorado Senior Law Day
  • Peer Review Rated For Ethical standards & Legal Ability TM Martindale Hubbell
  • Haystack