The Achieving Better Life Experiences (ABLE) Act

The Achieving Better Life Experiences (ABLE) Act became law in December 2014. It allows individuals who become disabled before age 26 to open special accounts to be used for disability-related expenses. ABLE accounts (known as 529A accounts) can grow without the earning being taxed, and up to $100,000 can be held in such an account without the funds affecting an individual’s SSI eligibility or benefits level. Like 529 college savings plans, each state will have to set up its own framework for 529A accounts.

Twenty-seven states have passed legislation and are currently working to establish ABLE account programs, while legislation is pending in 10 more states and the District of Columbia. The IRS and Treasury Department recently released a Notice of Proposed Rulemaking for ABLE accounts, available at 80 Fed. Reg. 35602 (June 19, 2015).

Among the topics in the proposed regulations are who can establish an ABLE account for themselves or for another person, how an individual’s state of residency is determined for ABLE account purposes, what happens if the account holder or beneficiary moves, and what expenses qualify for tax-free distributions from accounts. Comments can be submitted until September 21, 2015, at


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