Achieving a Better Life Experience (ABLE) Act

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Achieving a Better Life Experience (ABLE) Act

Who: Any individual diagnosed with a disability before their 26th birthday.  If you already receive Supplemental Security Income or Social Security Disability Insurance you are eligible.  Also, anyone who is not eligible for those program’s benefits might be eligible for an ABLE Account if they submit certification that meets the criteria for a disability (it is not yet defined what this disability certificate is/means but it is believed that this criteria will be similar to those required by SSI or Medicaid).


What: A North Carolina program that was just signed into law.  This Act will mean that a person with disabilities can start saving money in a tax-deferred account (which is an account that is not taxed until the money starts being used by the person.  Though it is specifically stated that if the money is withdrawn to be used for “qualified” expenses then the money will not be taxed) for expenses such as medical costs, education, housing, employment supports and anything else that Medicaid does not cover. 

When the “qualified beneficiary” (the person who the account is for) dies, money remaining in the ABLE account is used to “pay back” any state Medicaid plan that the person received.  As much money as you have received from Medicaid AFTER you created the ABLE account is as much as will be taken.  Any remaining money can be put into someone else’s ABLE account if that person is the designated beneficiary.  We could not find information on what will occur with any remaining money if the designated beneficiary does not have/qualify for an ABLE account.


How much: Up to $14,000 can be put into this account every year by “anyone” such as employers, family, and friends (this is currently the amount, but the number could change as it is tied to the cut-off for the annual gift-tax exemption).  Contributions to an ABLE account must be made from the contributors’ after-tax income.

Up to $100,000 saved here will NOT affect a person’s eligibility for Supplemental Security Income.  After $100,000, SSI benefits will be suspended; meaning that if the ABLE account drops back below $100,000, SSI will begin again with no need to re-apply.  Medicaid eligibility is not affected by the amount in an ABLE account.


Where: The accounts are being established by the NC Department of State Treasurer which means that a)the person who the account is for must live in NC and b)the account must be in NC (other states will have similar programs).  The money can be “rolled over” into another ABLE account in another state if the person moves, but this can only be done once every 12 months.


When: Currently unknown, but hopefully families can create an ABLE account in Fall 2016


Useful Links:


A Special Thank You to one of Parent to Parent's Intern who researched all this information.


An Affiliate of Family Support NetworkTM of North Carolina with support from:

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