If you are a resident of the State of Ohio you may have seen on local TV stations Josh Mandel, The Treasurer for the State of Ohio, making known that ABLE accounts are now available for individuals with disabilities. My curiosity has been peaked so in today’s article I will review the background of the ABLE accounts, discuss how they are beneficial to those either employed or seeking employment and take a look at how Congress is already proceeding with some helpful revisions.
In December 2014 President Obama signed the Achieving a Better Life Experience Act otherwise known as ABLE. In the passage of this Act, it opened the door for individuals with disabilities nationwide to have the capability of saving up to $100,000 without their Social Security benefits or other government assistance being at risk. In addition their Medicaid can be maintained. According to Sara Hart Weir, the president of the National Down Syndrome Society
The ABLE Act was an idea that started around a kitchen table in Northern Virginia by five dedicated parents from the Down syndrome community. Today is a historical achievement as now ABLE accounts are a reality for all individuals with disabilities in America thanks to the hard work of so many dedicated advocates from across the U.S.
In June 2016 Ohio became the first state to debut and begin enrollment into the ABLE Accounts. Other states have since joined including Nebraska, Tennessee and Florida. However, individuals from any state can join by enrolling in another states program.
Benefiting Employment First
Historically, the scenario of an individual with a disability and a job immediately brought forward the question of benefits. Many families and job seekers have the concern that if wages earned reach a certain cap then benefits would either decrease or be taken away altogether. Today, the question is still valid, but it has a new twist. The ABLE accounts currently allow individuals to save up to $14,000 a year without the loss of benefits. This is a huge advantage for those employed because it paves a way for earnings from their job to be saved safely without the fear of jeopardizing benefits. I find it advantageous for Ohio to be in the forefront of ABLE accounts as we continue paving the way nationwide for Employment First, where all individuals with disabilities are employable. Monies saved in this account can be used for a variety of approved expenses such as housing, education, basic living expenses, and more. To check out eligibility and additional resources, head to their homepage.
With the launch of the ABLE accounts over the summer 2016, Congress is already seeking revisions to help expand the program. The cap on the annual contribution is $14,000, however with revisions
The bill calls for people with disabilities who are employed to be allowed to save their earnings up to the federal poverty level — currently $11,770 for a single person — in their ABLE accounts above and beyond the existing cap, nearly doubling their annual savings allowance.
In a separate move, but relate-able Congress is looking at revisions to the ABLE Financial Planning Act which would allow families to rollover educational monies in a 529 college fund to an ABLE account. Sara Hart Weir states
We anticipate that these could be two technically-significant improvements to the ABLE program that we could get done this Congress. Especially for ABLE to Work, this is the most proactive improvement because we’re looking at ABLE as a way to incentivize employment.
The last revision includes changing the age in which the account can be set up. Currently the enrollee must be 26 years of age or under to start an account. The revision is calling for that age to be increased to 46, however this has not yet been considered.
ABLE accounts open the concept of benefits and income going hand in hand. There are limitations which should be expected, but this is a great first step in allowing for earnings to be set aside and used in meaningful ways. I’m hopeful that education on these accounts are occurring especially for families of children and young adults with developmental disabilities.