Special Savings Accounts Law Created for People with Disabilities

disability laws autism

President Barack Obama signed into law the Achieving a Better Life Experience Act (ABLE Act) on December 19, 2014. This is a tax-favored way for families and people with disabilities to save money for future expenses without being disqualified from federal benefits.

Previously, to qualify for S.S.I, a person could have no more than $2,000 in assets. The new law allows for an annual contribution of up to $14,000 and can grow to $100,000 without threatening S.S.I. benefits, although some states may have contribution limits that are higher.

When speaking with the NY Times, Ms. Weir, of the National Down Syndrome Society, described the law as the most significant piece of legislation affecting the disabled since the passage of the American with Disabilities Act was passed July 26, 1990. “This sends the message that people with disabilities can work and save money, and be as independent as possible,” said Ms. Weir.

Qualification requirements for the 529 ABLE Act, a beneficiary must have been entitled to S.S.I benefits, blind of disabled before the age of 26, or have a doctor’s certification of blindness or physical or mental impairment with results in severe limitations on function.

In addition, a disabled person, relatives or friends can make regular or one-time contributions that can be used for qualified expenses which includes education, housing, transportation, etc without being subject to income tax and a 10% penalty.

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