The Achieving a Better Life Experience (ABLE) Act of 2014 permits states to establish a new kind of account with tax-free earnings for individuals with disabilities. Families in the states that have passed legislation can make contributions to the ABLE accounts of eligible disabled individuals — this without jeopardizing the beneficiaries’ eligibility for certain means-tested federal programs (subject to some limitations). Are you aware of what may be available in your state?
The accounts can be used to cover qualified expenses such as education, housing and transportation. Other uses: obtaining and maintaining employment and acquiring personal support services and assistive technology. The accounts generally can be opened for individuals with significant disabilities developed before age 26. Contributions to the account are treated as nontaxable gifts to the beneficiary.
If you have any questions or would like more information on what is available in California, please give us a call.