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It is easy to be overwhelmed by all the challenges that come with having a disability – from healthcare, to government benefits, to financial planning. Congress created the Achieving a Better Life Experience Act (ABLE Act), signed into law by President Obama, which provides opportunities for disabled individuals and their families to save money while still maintaining their eligibility for public assistance.
Passed in 2014, the ABLE Act allows disabled people to open a tax-free savings account to pay for future educational, transportation, or healthcare-related expenses. Originally modeled off other tax-advantage accounts like college savings plans, the ABLE account allows you to create savings accounts for future expenses without exceeding limits that would otherwise prevent you from applying for Social Security Disability Insurance (SSDI) or Medicaid. To qualify, applicants must have been diagnosed with a severe disability before the age of 26 or have already been approved for SSDI benefits.
The ABLE Act is extremely helpful for people who are already receiving SSA benefits, as it allows them more flexibility in managing their money. Currently, SSI limits personal, countable assets to $2,000 for individuals and $3,000 for couples. If you qualify for SSI but start to go above the asset threshold, you risk having your benefits altered or even terminated. Under the ABLE Act, you can save up to $100,000 in an ABLE fund without it being recognized by the SSA as a countable resource or affecting your future benefits.
While you can save a lot of money in ABLE accounts, it is important to note that funds can only be used for specific qualifying disability expenses, also called QDEs. In short, QDEs are medically necessary things that directly benefit the disabled person, whether to maintain your health, improve your quality of life, or make you more independent. Some of the most common uses for this money includes transportation services, employee training or support, assistive technology, legal fees, or even housing.
The ABLE fund does allow some flexibility when it comes to helping family members. Parents and guardians can buy things on behalf of the disabled person so long as it directly benefits them, such as buying a modified vehicle that can more easily transport them.
Paying for your necessary medical expenses and assisted-living costs is now much easier with the ABLE Act. The compassionate team at Jan Dils, Attorneys at Law can discuss how you can use this account and remain below the asset threshold to continue receiving SSI benefits. Even SSDI beneficiaries can take advantage of this account. Call us today to learn more!
To Schedule an Appointment, Call Us Toll Free at 1.877.873.8208 or Email Us for a Prompt Response.
Jan Dils, Attorneys at Law
