In the flurry of new laws passed at the end of 2013, there was a law that provides additional options for individuals with special needs or disabilities. The law is called the ABLE Act – the “Achieving a Better Life Experience” Act. It had overwhelming support from all political parties, something that is rare these days. As you might expect, I am not able to cover all the details one blog post, especially when much of the “nuts and bolts” of how ABLE accounts will work has yet to be figured out through the regulatory process. So, I will attempt to summarize the act and some important considerations.
The ABLE Act recognizes that there are additional financial strains faced by individuals with disabilities and their families, including those in the Grand Rapids, Michigan area. In short, the ABLE Act allows for individuals to utilize a tax-free, state-based private savings account, referred to as an ABLE account, for the care of people with disabilities. This ABLE account can be used to supplement government benefits for “qualified disability expenses” such as medical and dental care, education, employment training, housing, and transportation, while not disqualifying a disabled individual from governmental benefits. As a result of the ABLE Act, eligible individuals and families are now allowed to establish ABLE savings accounts that will not affect their eligibility for Supplemental Security Income, Medicaid and other public benefits.
