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  • Writer's pictureMartin Flax

The SSI recipient and the value of an ABLE Account

History of the ABLE Account Legislation

If you or your family member is on Supplemental Security Income “SSI” due to a disability, the federal government allows you to have resources valued up to $2,000.00 (or $3,000.00 if married.) When an individual receives SSI, they are also automatically eligible for Medicaid health insurance or what is known in Massachusetts as MassHealth. Once the resources of the SSI recipient exceed $2,000.00, they can be disqualified from the right to receive SSI benefits for that month. Often, the loss of the accompanying MassHealth is an even more worrisome result of the disqualification.

For years, families and individuals have lived with the knowledge that they would have to monitor the SSI recipient’s bank accounts to make sure that any income or gifts received did not allow their resources to exceed the $2,000.00 threshold. This frustration was a part of the disability world since the inception of the SSI program in 1972, especially for disabled persons who were employed.

Finally, after many years of lobbying by the disability community, on December 19, 2014, Congress passed the Stephen Beck, Jr., Achieving a Better Life Experience Act (ABLE). The purpose of the Act was to ease financial strains faced by individuals with disabilities by creating tax-free saving accounts available to cover qualified disability expenses. The Act set up a structure whereby a disabled person could save money in excess of the $2,000.00 threshold and not lose their SSI benefits as long as the money was put into a special “ABLE” account and was then spent on allowable items. The ABLE act allows individuals that previously worried that they could not maintain a modicum of savings to help them achieve greater security and independence in order to navigate the uncertainties of life.

Where can I find an ABLE account?

Approximately 44 states currently have ABLE account programs. You are not required to use the program in your state, but it may be advantageous to do so.

How much money can you keep in an ABLE account?

As a general matter, the disabled person can deposit up to $15,000.00 per year in the ABLE account. If the account balance increases to over $100,000.00, over the years the SSI recipient will be ineligible for SSI, but can still maintain MassHealth benefits. As of January 1, 2018, a disabled person who is employed, is allowed to deposit additional earnings into the account (in addition to the annual $15,000.00 ) of the lesser of (a) the Federal poverty line for a one-person household; or (b) the individual’s compensation for the taxable year.

What can ABLE account funds be used for?

ABLE funds must be used for “qualified disability expenses.” A “qualified disability expense” means any expense related to the designated beneficiary as a result of living a life with disabilities and may include education, housing, transportation, employment training and support, assistive technology, personal support services, health care expenses, financial management administrative services and other expenses which helps improve the health, independence, and/or quality of life of the recipient.

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