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Do you or someone you know have a disability? Achieving a Better Life Experience (ABLE) is an investment account that you can use to pay for disability related expenses.

The ABLE Act was bipartisan legislation (crazy, right?!) introduced in 2013 and passed at the end of 2014. The ABLE Act amended Section 529 of the IRS code to create a tax-free savings account for individuals with disabilities.

These accounts are funded with after tax dollars; while some states offer state income tax deductions. Ohio for example, allows $4,000 of contributions to be deducted for income tax purposes (with unlimited carry forward). ABLE accounts can grow tax free and purchases are tax free on qualified disability-related expenses (including education, housing, and transportation).

The ABLE account may only be used for Qualified Disability Expenses (QDE’s).

Here is a list of examples of QDE’s that are enforced by IRS. The Ohio Stable Account sums it up well with their three expense qualifiers:

  • You incurred the expense at a time when you were an Eligible Individual;

  • The expense relates to your disability; and

  • The expense helps you to maintain or improve your health, independence, or quality of life

One key attribute that ABLE accounts have that other asset accounts do not (checking, savings, IRA, 529, ESA, taxable investment account and other items of significant value) is that they do not count against any public assistance an individual with a disability may receive; such as:

  • Medicaid

  • Supplemental Security Income (SSI) or

  • Supplemental Nutritional Assistance Program (SNAP)

One exception to this is that if you receive SSI, your ABLE account balance must be $100,000 or below to receive the benefit or your benefit will be suspended. Many of these benefits require that you have no more than $2,000 in non-ABLE assets to qualify for these benefits.

The legislation states the purpose of an ABLE account is to use private savings to “secure funding for disability-related expenses on behalf of designated beneficiaries with disabilities that will supplement, but not supplant, benefits provided through private insurance, Medicaid, SSI, the beneficiary’s employment and other sources”.

The current law states that the individual’s disability must have been onset before the age of 26. However, there is current legislation, The ABLE Age Adjustment Act (S. 651/H.R. 1814), slated to increase the age to 46.

If you meet the age criteria and are receiving SSI or SSDI benefits, you are automatically eligible to establish an ABLE account. If you meet the age criteria, but are not currently receiving SSI or SSDI, you may still be eligible if you meet SSA’s definition of disability and receive a letter of certification from a licensed physician. You can be over the age of 26 and still contribute to an ABLE account as long as your disability had an onset of prior to 26.

ABLE Account Rules May Vary By State

The ABLE accounts are managed by states, but each state has their own set of rules. You may only have one ABLE account per individual and it can be in another states’ plan if it allows outside residents. Ohio, California and North Carolina allow non-residents to enroll; while Texas, Georgia, South Carolina, Florida and Tennessee do not.

To look at your own state options, you can use the comparison tool: For Ohio residents the program is called the STABLE Account and an account can be opened through

For a wealth of other information on ABLE Accounts visit the ABLE National Resource Center:

If you have a question on the ABLE account and how it could affect your financial plan, schedule some time to talk to a Whitaker-Myers advisor today.


August 25, 2020

Andrew Young

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