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What is an ABLE account?

On Behalf of | Feb 7, 2018 | Social Security Disability

While this blog has frequently discussed the requirements that Floridians have to meet in order to show that they are legally disabled for the purpose of getting disability benefits through the Social Security Administration, oftentimes, disabled residents of Kissimmee or other parts of Central Florida also need to be mindful of their income and assets.

For instance, if a person has qualified for supplemental security income, or SSI, then he or she will only be allowed to maintain a certain level of assets if he or she wishes to continue receiving benefits. Even for those who are not on SSI, having property or investments may prevent them from taking advantage of other programs that disabled people frequently find helpful an even necessary, such as Medicaid.

Under new laws from 2014, a person who is legally disabled may open an maintain what is called an ABLE account. Families can use an ABLE account to pay for certain expenses while it grows tax free via investments in various markets. Perhaps the most important aspect of an ABLE account is that it does not affect eligibility for government benefits so long as the account remains below $100,000.

Not everyone who is legally disabled is allowed to use an able account to amass their savings, however. Specifically, to be able to rely on an ABLE account, a person will have to prove that he or she had a disability since before the time he or she was 26 years old. The disability also most continue for at least one year.

Those who have an ABLE account, as of right now, can contribute $15,000 annually at the most. However, with the new tax reforms going in to effect, this cap will likely be raised.



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