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ABLE Accounts and New 2018 Changes

January 12, 2018 in News

Written by Christian Horde, Esq

The Achieving a Better Life Experience (ABLE) Act of 2014 allowed for the establishment of ABLE Accounts to be used by qualified individuals as a way to earn and save money without being disqualified from government benefits. To qualify, the individual must have been disabled before the age of 26 and be able to prove their disability.

ABLE Accounts can be used when the special needs individual receives settlement proceeds, gifts from family or friends, or income earned from employment such as the Social Security Administration’s Ticket to Work Program.

The annual contribution limit matches the annual gift tax exclusion, so for the year 2018 the annual contribution limit for ABLE Accounts is $15,000.

ABLE Accounts are governed by 26 U.S.C. § 529A which is the same section that governs 529 Educational Accounts.

The recently passed H.R. 1 – Tax Cuts and Jobs Act made the following changes to ABLE Accounts for 2018:

The Act allows for rollover of 529 Educational Accounts to ABLE Accounts. As long as the 529 Educational Account has either the individual with a disability or a family member named as beneficiary.

The Act allows ABLE Account owners to contribute funds in excess of the annual limit, up to the Federal Poverty Limit or earned income, whichever is less, if they are not participating in an employer sponsored retirement plan.

To learn more about Florida ABLE Accounts visit:


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