A new program is underway in Washington state so individuals with disabilities can now properly save for a rainy day. The “Achieving a Better Life Experience” (ABLE) Act savings plan, allows eligible people with disabilities to hold up to $100,000 in tax-advantaged savings accounts similar to 529 college savings plans (also called a 529A account).

photo by Ken Teegardin

Anyone can put money into an ABLE account, such as family or friends, up to $14,000 per year, without affecting eligibility for federal SSI and Medicaid benefits. To qualify for an ABLE account, the account owner must have a disability before their 26th birthday. If the account goes above $100,000, the person with the disability will lose monthly government cash benefits until it drops below that level again. Medicaid health benefits are never affected, no matter how much money is saved. Money can be invested in index funds and earnings are not taxed.

Washington Governor Jay Inslee signed this Act into law as HB 2323 in March 2016. Once it is available, this option will provide a much-needed savings option for families. “It’s weighed heavily on my mind that our 19 year old son could save his income to help pay for pay for college, his car expenses, travel, and emergencies, but that his 20 year old brother with exceptional needs couldn't save more than $2,000 without losing his state and federal benefits,” remarked Washington Autism Alliance & Advocacy CEO, Arzu Forough. “This Act allows our 20 year old to save for his future needs."

There are an estimated 130,000 to 180,000 children and adults with disabilities in Washington State who could potentially use the ABLE program, with an implementation date of July 1, 2017. ABLE accounts are managed by a governing board appointed by the Governor. To apply or recommend an applicant, visit this page. You can read the ABLE Workgroup Report to the Legislature here.  

The ABLE National Resource Center created a website to help families understand eligibility and the application process for creating ABLE Accounts. Webinars and more information about what other states are doing, are at http://www.ablenrc.org.

Washington State Program Administrators:

• State Treasurer’s Office

Scott Merriman

Ph: 360-902-9018

• State Treasurer, Peter Tassoni

Dept. of Commerce

Ph: 360.725.3125 peter.tassoni@commerce.wa.gov