Change_spilling_out_of_a_vaseIt’s a great time to assess your financial well-being and take control of your financial future. One way you may be able to do this is by opening an ABLE Account. ABLE accounts are tax-advantaged savings accounts that are available to certain people with disabilities.

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2022 ABLE Update

Apr 21, 2022

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Achieving a Better Life Experience (ABLE) Accounts are tax-advantaged savings accounts that are available to certain people with disabilities. By opening an ABLE Account, you may be able to save more money each year to help you pay for disability-related expenses.

How do I open an ABLE account?

The ABLE Act limits eligibility to people with disabilities who had an onset of disability before they turned 26. If you meet the eligibility criteria, you must choose the state where you plan to open your account. More than half of the states in the country have launched ABLE programs, and you are not required to establish your account in the state where you live. To help you decide, use the state comparison tool and review tips for opening your ABLE account. Then, visit the program website of that state and complete the application.

What can ABLE account funds be used for?

Update!

In 2022, a beneficiary, family, friends or an employer can deposit up to $16,000 per year into an ABLE account.

An employed account owner may qualify to contribute an additional amount, up to $12,880 of earnings if he/she lives in the continental United States or $16,090 (Alaska) or $14,820 (Hawaii) from earnings. Contributions can also be made through permitted rollovers from other ABLE accounts or 529 college savings accounts.*

*ABLE National Resource Center

ABLE account funds can be used for "qualified disability-related expenses" (QDE). A QDE is any expense the beneficiary incurs as a result of the disability. These may include expenses related to education, housing, transportation, employment training and support, assistive technology, personal support services, healthcare expense, financial management and administrative services, and other expenses that help improve health, independence and/or quality of life.

Although you do not need to submit receipts for the expenses, they should be kept along with other documentation of the expense. If you're unsure whether something is a QDE, you can check with the Internal Revenue Service (IRS), the only organization that can make that decision.

How do ABLE accounts affect my Social Security disability benefits?

If you receive SSDI, are working, and deposit part or all of your earnings into an ABLE Account, Social Security still considers this deposited money as "countable earnings" and applies Work Incentives to determine if you're engaging in substantial gainful activity (SGA). However, deposits made into an ABLE account by others are not considered countable income for determining SGA.

However, if you receive SSI benefits, the ABLE Act sets further limitations. According to the LEAD Center, the first $100,000 in your ABLE Account would be exempted from the SSI $2,000 individual resource limit. If and when your ABLE Account exceeds $100,000, your SSI benefit payment would be suspended until the account falls below $100,000. It is important to note that while your eligibility for a benefit payment is suspended, this has no effect on your ability to receive or be eligible to receive medical assistance through Medicaid.

If you have questions about how ABLE Accounts may affect your disability benefit, please use Choose Work’s Find Help Tool to find a Benefits Counselor who can help answer your questions or contact the ABLE National Resource Center.

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