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Would an ABLE account benefit your loved one with disabilities?

According to a June 2019 article in Disability Scoop, participation in ABLE accounts has been slower than anticipated. State officials nationally are concerned about the long-term sustainability of the ABLE program if more accounts are not opened.


ABLE accounts, which became legal in 2014, are important financial tools for people with disabilities that resemble 529 accounts for higher education expenses. Money saved in these accounts helps to protect eligibility for important public benefits like monthly support under Supplemental Security Income or SSI, housing benefits from the U.S. Department of Housing and Urban Development or HUD, and public health insurance and residential services under Medicaid, called Health First Colorado in our state.

(For purposes of SSI, ABLE money is not countable as an asset until it exceeds $100,000 and may never be countable at any level for other benefit programs. There are some limits on annual contribution totals and on the sources of such funds. ABLE funds spent on qualified disability expenses is not taxable.)

Normally, most government benefit programs limit assets at $2,000, which prompted advocates to fight hard and long to get ABLE account legislation passed. People with disabilities must live in poverty to remain eligible for these programs that can be lifelines for them.

We have written about ABLE account characteristics before.

Growing concerns

Disability Scoop reports that at the end of 2018, not even 35,000 ABLE accounts existed nationally. The National Association of State Treasurers estimates that there should be 450,000 by June 2021 to keep most state ABLE programs sustainable and keep fees low. That would be a huge jump in numbers.

Currently, 42 states plus DC offer ABLE programs, some of which are available across state lines.

To help raise the numbers, advocates want Congress to increase the eligibility from people whose disabilities started before age 26 to age 46. Other options may include allowing more than one ABLE account for an individual or allowing larger deposits in certain situations like receipt of a settlement or inherited money.

The national group says it is not yet alarmed since saving is a new practice to people with disabilities who have lived a long time focused on keeping their money at low levels. Despite current numbers, ABLE account numbers are growing.

Anyone with disabilities or whose child or other family member has disabilities should speak with an informed attorney to understand whether an ABLE account makes sense for them.

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