News From LIFE
Living Independently for Everyone!
An ABLE account is a new way for people with disabilities to receive tax-free gifts without losing their benefits. Opening an ABLE account online is easy with as little as $25. Then you can set up a gifting page and select a savings goal. Share the gifting page with friends and family. These savings do not count when determining an Idaho resident’s eligibility for state or local assistance.
Although Idaho residents can’t currently open ABLE accounts in Idaho, you can open one in Washington.
ABLE accounts are bank accounts that allow people with disabilities to save money without jeopardizing their disability benefits. A traditional bank account balance can count against that person’s ability to qualify for benefits. As a result, people with disabilities are not able to build savings with money they earner receive from an inheritance or gift. One way around this issue is to use a special needs trust, but it must be controlled by a trustee – not by the person with the disability. This limits a person’s independence.
Anyone can contribute money to an ABLE account, including the owner. Contributions are capped at $15,000 per year. To be clear, the owner of the account must keep track to ensure they do not exceed $15,000 for the calendar year.
For those who qualify for SSI, the balance of an ABLE account can’t exceed $100,000. The income earned from the funds are not taxed. Contributions are made with post-tax dollars.
The kicker is funds must be used for Qualified Disability Expenses (QDE). Thankfully, this is a fairly broad definition and can include expenses for housing, education, transportation, employment training, health and wellness, legal fees and more. So think about assistive technology, an accessible vehicle or power chair!
So check out setting one up before the holidays. To learn more about how to receive or make a gift to an ABLE account watch Washington State’s step-by-step video . Or call Idaho SILC 208-334-3800
LIFE, Inc. – Living Independently for Everyone!
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