Better serve your clients with comprehensive ABLE expertise and support.

ABLE accounts offer people with disabilities a way to invest tax-free for the future, spend on everyday expenses, and still keep the public benefits they rely on every day. A few key benefits of an ABLE account include:

• Tax-free growth and tax-free withdrawals for qualified expenses
• Money in your ABLE account, as well as withdrawals for qualified expenses, do not count as an asset for purposes of federal benefits programs (some SSI exceptions apply)
• Income tax deductions and credits in certain states
• You can contribute up to $19,000 a year - or more if employed
• Anyone can contribute - family, friends, employers, etc.
• Various investment portfolios and savings options
• Prepaid debit card for easy withdrawals and spending
• Funds from a 529 College Savings Account can be rolled over into an ABLE account, tax-free

When you make contributions to an ABLE account, you can choose to put your money in savings options or in investment portfolios. Your contributions then have the chance to grow tax-free. And unlike many other investment options, when you withdraw your savings to use for qualified expenses, those withdrawals are tax-free, too.

Finally, managing the account is a snap with access to Vestwell’s simple and intuitive online platform.

Millions of people with disabilities rely on public benefits and federal programs such as Supplemental Security Income (SSI) and Medicaid for their basic needs, but this assistance can be limiting. Those receiving much needed benefits, like SSI, are restricted to having only around $2,000 in assets, essentially forcing them to live in poverty. The Stephen Beck, Jr. Achieving a Better Life Experience Act, known as the ABLE Act, was passed by Congress in 2014 and allows states to create tax-advantaged savings programs for people with disabilities. After the ABLE Act was passed, people with eligible disabilities could finally save for their everyday needs, invest in a tax-free account, and prepare for the future without losing critical public benefits.

No. When saving with an ABLE account, your clients can keep their federal benefits (SSI, SSDI, Medicaid, SNAP, TANF, HUD Assistance, Section 8, etc.).

If they receive SSI, there is a $100,000 limit before ABLE funds start counting against their $2,000 asset limit. If they choose to go over the $100,000 limit, their SSI benefits will be suspended, but they’ll still be eligible for all other benefits (such as Medicaid). Once their balance drops below the limit, their SSI benefits will resume as normal.

No. If the money in the ABLE account is used to pay for qualified expenses, it won’t be counted as income for state or federal taxes.

ABLE accounts, Special Needs Trusts (SNTs), and Pooled Trusts are all financial tools that can help people with disabilities to save money. What is best for your client will depend on their individual situation and goals. Keep in mind: the best option might be to use both an ABLE account and trust together! Read on for an outline of some key advantages of ABLE accounts.

• Expenses: There are fewer expenses than setting up a trust - you do not have to hire an attorney to set up an ABLE account.
• Ownership: The beneficiary owns the funds and can access them for eligible expenses. They do not have to ask a trustee for access to their money.
• Eligibility: Limited to people diagnosed with a disability that began before the age of 26 (the age of onset for disability will be raised to 46 starting January 1, 2026).
• Taxation: Earnings from ABLE accounts are tax-free; trusts are subject to taxation.
• Contributions: There’s an annual contribution limit ($19,000 - or up to $34,060 for certain working beneficiaries).
• Flexible Spending: Funds can be used for a wide range of expenses, including basic living costs, education, and employment without affecting benefits.
• Fees: Low fees.

A person with a disability ( the “beneficiary”) can only own one ABLE account at any given time. However, if you act in a support role for people with disabilities, you can manage multiple ABLE accounts for different beneficiaries (e.g., a parent can manage two ABLE accounts for two children). Similarly, advisors can view and manage multiple ABLE accounts for different beneficiaries.

Most expenses related to the costs associated with living with a disability qualify as an eligible expense. The expense must simply help maintain or improve the health, independence, or quality of life of the person living with a disability. Some of the most common qualified expenses as defined by the IRS include:

• Living expenses
• Education
• Housing
• Transportation
• Employment, training, and support
• Assistive technology
• Personal support services
• Health, prevention, and wellness
• Financial management
• Administrative services
• Legal fees
• Oversight and monitoring
• Funeral and burial costs
• And more