ABLE United
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FAQs

Have questions?
The answers below might be able to help.

General

Eligibility

Government Benefits

Account Management

Opening an Account

Contributions

Savings and Investment Options

Withdrawal

Medicaid Repayment

Comparison to Special Needs Trust

What is the ABLE Act?

The Stephen Beck, Jr. Achieving a Better Life Experience (ABLE) Act, a federal law enacted in December 2014, authorizes each state to establish a program that offers tax-free savings and investment options to encourage individuals with a disability and their families to save private funds to support health, independence, and quality of life.

Money contributed to an account in one of these programs is generally disregarded when determining eligibility for federal benefit programs, such as Supplemental Security Income (SSI) and Medicaid.

What does “529A” mean?

“529A” refers to Section 529A of the Internal Revenue Code. This is the legal framework for many of the specific rules of an ABLE United account.

In addition, Section 529A provides for the federal income tax exemption for earnings in an ABLE United account.

What is the ABLE United Program?

The ABLE United Program is the qualified ABLE program offered by the state of Florida.

The Program is administered by Florida ABLE, Inc. a direct-support organization of the Florida Prepaid College Board (Board).

The Board, established in 1987, oversees approximately $15 billion in collective investments in the Stanley G. Tate Florida Prepaid College Program and the Florida 529 Savings Program.

Who may open an ABLE United account?

There are three eligibility criteria for opening an ABLE United account:

  1. Disability Severity Criteria
    The individual must be blind or have a disability that meets the disability and severity requirements for Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI).
  2. Disability Onset
    The onset of blindness or disability must have occurred before the individual’s 26th birthday.
  3. Florida Residency
    The individual must be a Florida residential the time of application.

What are the disability and severity requirements for SSI and SSDI?

For the purposes of ABLE United account eligibility, the disability and severity requirements refer to the Social Security Administrations definition for a child with a disability and blindness – regardless of the current age of the individual opening an ABLE United account.

Disability (Child under 18): A medically determinable physical or mental impairment that results in marked and severe functional limitation(s), and which can be expected to result in death, or has lasted or can be expected to last for a continuous period of not less than 12 months.

Blindness: vision, with use of a correcting lens, which is 20/200 or less in the better eye or tunnel vision of 20 degrees or less.

What conditions qualify for an ABLE United account?

The Internal Revenue Service categorizes eligible disabilities as follows:

  • Developmental Disorders: Autistic Spectrum Disorder, Asperger’s Disorder, Developmental delays and learning disabilities
  • Intellectual Disability: May be reported as mild, moderate, or severe intellectual disability
  • Psychiatric Disorders: Schizophrenia, Major depressive disorder, Post-Traumatic Stress Disorder (PTSD), Anorexia Nervosa, Attention Deficit/Hyperactivity Disorder (AD/HD), Bipolar Disorder
  • Nervous Disorders: Blindness, Deafness, Cerebral Palsy, Muscular Dystrophy, Spina Bifida, Juvenile-onset Huntington’s Disease, Multiple Sclerosis, Severe sensorineural hearing loss, Congenital cataracts
  • Congenital Anomalies: Chromosomal abnormalities, including Down Syndrome; Osteogenesis Imperfecta, Xeroderma Pigmentosum, Spinal muscular atrophy, Fragile X Syndrome, Edwards Syndrome
  • Respiratory Disorders: Cystic Fibrosis
  • Other: Includes Tetralogy of Fallot, Hypoplastic left heart syndrome, End-stage liver disease, Juvenile-onset rheumatoid arthritis, Sickle cell disease, Hemophilia, and any other disability not listed

I am older than 26, may I open an ABLE United account?

Current age is not considered when opening an ABLE United account – except that the account must be opened by an adult 18 years of age or older.

The onset of the disability must have occurred before the individual’s 26th birthday.

Do I have to receive disability benefits to be eligible for an ABLE United account?

No. ABLE United accounts allow individuals with a disability and their family to save private funds tax-free, much like a Roth IRA (Individual Retirement Account) or 529 college savings account.

Money in an ABLE United account is generally disregarded when determining eligibility for government benefit programs but an individual need not receive disability benefits to be eligible to open an ABLE United account.

How will an ABLE United account affect my federal benefits?

An ABLE United account is disregarded when determining federal benefit eligibility with the following two exceptions for individuals receiving Supplemental Security Income (SSI):

  1. For the purposes of determining eligibility for SSI, money in an ABLE United account in excess of $100,000 is considered an asset to the individual with a disability and may cause SSI benefits to be reduced or suspended. An account balance up to and including $100,000 is disregarded.
  2. A withdrawal that will be used for a housing or a non-qualified disability expense but that is not spent in the same month will be considered an asset of the individual with a disability and may cause SSI benefits to be reduced or suspended.

There is no impact on Medicaid benefits, regardless of how much money is in the ABLE United account, even if SSI benefits are reduced or suspended due to the ABLE United account.

How will having an ABLE account affect my state benefits?

In general, ABLE accounts are expected to be disregarded from consideration by state benefit programs, with the exceptions addressed above. To determine whether your specific state benefits may be impacted, please contact your provider.

Does having an ABLE United account help me qualify to receive disability benefits?

Qualifying for and opening an ABLE United account does not, by itself, allow an individual to qualify for any disability benefit program.

However, since funds in an ABLE United account are generally disregarded when determining eligibility for disability benefit programs, contributing money into an ABLE United account will reduce countable assets considered for benefit eligibility and may help an individual qualify for a program that they were otherwise not qualified for based on countable assets.

Who may contribute to an ABLE United account?

Anyone may contribute to an ABLE United account on behalf of the individual with a disability, including the individual, an organization, friends and family. Contributions are considered a completed gift.

How can I contribute to an ABLE United account?

Contributions may be made to an ABLE United account by check or electronic payment, including the option for automatic contributions from a linked checking or savings account. A gifting event can be setup under account login under the eGift tab. This will allow for third parties to contribute electronically. Third parties can also use this Gift Certificate.

Is there a limit to the amount of money that may be contributed to an ABLE United account?

The individual with a disability and others contributing on their behalf, may contribute up to $14,000 in total to an ABLE Account each year.

Contributions are not allowed if and when the account balance is at, or above, $418,000.

Do contributions to an ABLE United account reduce taxable income?

No. Contributions do not reduce the taxable income of the contributor. Contributions are made with after-tax dollars, much like a Roth IRA (Individual Retirement Account) or a 529 college savings account

Are contributions to an ABLE United account considered an asset?

Contributions made to an ABLE United account are generally not considered an asset to the individual with a disability for the purposes of federal means-testing. However, if a third-party provides money to the individual with a disability, rather than a direct contribution to the ABLE United account, that money may be considered an asset of the individual until it is transferred to the ABLE United account.

Are contributions to an ABLE United Account from family and friends considered income?

Contributions made directly to an ABLE United account from a third-party are not considered income to the individual with a disability; rather, contributions are considered completed gifts.

May I transfer funds from a Special Needs Trust to an ABLE United account?

ABLE accounts can accept contributions from Special Needs Trust. Please consult your Special Needs Trust documents, or consult with an attorney or your trustee. Transferring funds from a Special Needs Trust to an ABLE United account may be beneficial. When compared to a Special Needs Trust, an ABLE United account:

  • is less expensive,
  • allows for direct access to funds for authorized individuals,
  • provides tax-free earnings, and
  • can pay for housing expenses without lowering SSI payments.

May I rollover a 529 College Savings Account into my ABLE United account?

Yes, you may transfer funds from your 529 College Savings Account to your ABLE United Account or a family member’s ABLE United Account.

529 College Savings Account rollover funds count toward the $15,000 maximum annual contribution limit.

For more information, see the College Saving Account to ABLE United Rollover Form or call customer service at 1-888-524-ABLE(2253).

How are the funds in an ABLE United Account invested?

The ABLE United Program offers multiple savings and investment options with varying degrees of investment risk.

An individual with a disability, or an authorized person on their behalf, may choose the most appropriate option(s).

The underlying savings and investment products for each investment option are managed by professional investment management firms selected by the ABLE United Program based on investment philosophy and strategy; performance history; and organizational experience and financial stability.

What are my savings and investment options in the ABLE United Program?

The ABLE United Program offers three portfolio options structured to align with an individual’s risk tolerance.

  • Conservative – The objective of the Conservative portfolio is to provide the opportunity to generate short-term income. This option offers low to moderate opportunity for long-term growth.
  • Moderate – The objective of the Moderate portfolio is to provide the opportunity to generate both long-term capital growth and short-term income.
  • Growth – The objective of the Growth portfolio is to provide the opportunity for long-term capital growth with less consideration given to short-term income.

For participants that prefer to create their own portfolio, the ABLE United Program offers the following individual options.

  • Money Market (Florida Prime) – The objective of the Money Market option is to provide exposure to high quality, liquid, short-term investments to control credit risk and interest rate sensitivity.
  • Fixed Income (Vanguard) – The objective of the Fixed Income option is to provide exposure to the broad U.S. bond market.
  • U.S. Equity (Vanguard) – The objective of the U.S. Equity option is to provide the opportunity for meaningful long-term growth through exposure to the broad U.S. stock market.
  • International Equity (BlackRock) – The objective of the International Equity option is to provide the opportunity for meaningful long-term growth through exposure to international stocks in developed markets.
  • For more information, visit the Savings and Investment options page.

Which savings or investment option should I choose?

The ABLE United Program cannot provide tax or investment advice. The U.S Securities and Exchange Commission provides general investment guidance which includes:

  • Have a financial plan.
  • Understand your risk tolerance.
  • Diversify your investments.
  • Start saving early.

For more information visit: www.investor.gov/investing-basics.

lease consult your investment adviser to discuss your specific situation and options.

May I change or update my investment selections?

Yes. The distribution of money between investment options is called an allocation.

For new contributions, you may change the allocation at any time.

For money that is already in an ABLE United account, the allocation of the account balance may be modified up to two times per calendar year.

How do I access funds in an ABLE United account?

Money in an ABLE United account may be withdrawn at any time and for any reason via electronic transfer or check.

If the money is spent on one of the following Qualified Disability Expenses, which are intended to include “living expenses” and are not required to be medically necessary, the earnings on the money withdrawn is tax-free:

  • Health
  • Education
  • Housing
  • Transportation
  • Legal Fees
  • Financial Management
  • Employment Training and Support
  • Assistive Technology and Personal Support Services
  • Oversight and Monitoring
  • Funeral and Burial
  • Other expenses approved by the Secretary of the U.S. Treasury

Do withdrawals require approval from the ABLE United Program?

No. The ABLE United Program does not approve withdrawals from an ABLE United account.

Money may be withdrawn from an ABLE United account at any time and for any reason.

Who determines whether my expense is a Qualified Disability Expense?

Each year, the ABLE United Program will report the total amount of distributions to the Internal Revenue Service (IRS) as part of our annual tax reporting.

The IRS may investigate the distributions from an ABLE United account to determine whether a withdrawal was for a Qualified Disability Expense.

In addition, each month, the ABLE United Program will report the date and amount of each distribution from an ABLE United account to the Social Security Administration.

If the individual with a disability receives Supplemental Security Income (SSI), Social Security Disability Insurance (SSDI) or Medicaid, the Social Security Administration may investigate any distribution to determine whether the withdrawal was for a Qualified Disability Expense.

In general, we recommend that documents and information adequate to justify each expense as qualified be retained by the individual or person administering the ABLE United account on their behalf.

What if my expense is not a Qualified Disability Expense?

If money is withdrawn from an ABLE United account to pay a non-qualified expense, the earnings portion of the withdrawal (only the earnings) will be considered income to the individual with a disability, taxed at the individual’s federal income tax rate, and will be assessed an additional 10% penalty.

In addition, the funds withdrawn will be considered an asset to the individual with a disability. The treatment of the withdrawal as an asset and the earnings as income may result in a reduction or suspension of federal disability benefits.

What is Medicaid repayment?

Federal law requires that each state recover Medicaid expenditures from a Medicaid recipient’s estate. Federal law also allows for a state to recover Medicaid expenditures from an ABLE United account.

Effective July 1, 2018 through June 30, 2019, except as required by federal law, the Florida Medicaid program may not file a claim for Medicaid recovery of funds in an ABLE account during this time period. Upon the death of a designated beneficiary, funds in the ABLE account must first be distributed for qualified disability expenses then transferred to the estate of the designated beneficiary or an ABLE account of another eligible individual specified by the designated beneficiary.

For more information on Medicaid estate recovery, visit Florida’s Medicaid Estate Recovery Program here.

How does an ABLE United account work with my Special Needs Trust?

An ABLE United account may be used as a complement, or alternative, to a Special Needs Trust.

  • In general, an ABLE United account is less expensive than an Special Needs Trust. By comparison, an ABLE United account costs $50 and less than 0.5% of assets annually. A Special Needs Trust can cost $500 to $5,000 to establish and 1-2% of assets annually.
  • An ABLE United account allows for direct access to funds for authorized individuals unlike a Special Needs Trust which may require withdrawal requests to be approved by a trustee.
  • An ABLE United account provides tax-free earnings unlike a Special Needs Trust where earnings are taxed at trust rates.

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