The Achieving a Better Life Experience (ABLE) program has been a hot topic in the disabled community for years now. This highly anticipated program allows individuals with disabilities to save money without worrying about it impacting their ability to access government programs like Medi-Cal and SSI.
An ABLE account, which will be known as CalABLE in California, is a tax-advantaged savings account that can be set up for the benefit of individuals with disabilities. Parents, family, friends and even the beneficiary themselves can make contributions up to $15,000 per year. Then, the account’s earnings accumulate tax-free.
Also, as long as the withdrawals are for qualified disability expenses, they are also tax-free. But, the biggest benefit of an ABLE account is that the savings held in the account, up to a current $100,000 limit, are not counted against the $2,000 limit on personal assets for individuals to qualify for government benefits.
The only problem now is that California has yet to implement the program. It is expected to launch later in the year. Several other states have already launched their ABLE account program and the good news is you can take advantage of those.
The Federal ABLE program allows you to set up an account in any state whose program is functional. Several states already have their programs underway so you can get started now if you like. If we can help you get started or if you’d like to speak to a qualified Orange County attorney who is knowledgeable about the ABLE program and other special needs planning strategies, call our office at (949) 260-1400 and schedule a free consultation.