The Florida ABLE Account: Relief for Disabled People

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People with special needs often face rapidly increasing costs for their care and shrinking public benefits. For example, eligibility for some benefits is based on the recipient’s income and resources. Applicants may try to keep their income below those limitations only to see their available funds are insufficient to meet their needs. The Florida ABLE Account is in place to provide relief for disabled people.

Achieving a Better Life Experience (ABLE) Accounts.

ABLE accounts came into being in 2014 as a result of The Stephen Beck, Jr. Achieving a Better Life Experience (ABLE) Act. Under ABLE, each state establishes its own program that offers tax-free savings and investment options to disabled persons and their families.

Eligibility and Restrictions.

The Florida ABLE program is open only to Florida residents with a qualifying disability that occurred before age 26. A person is considered “disabled” based on Social Security guidelines.

Each person may only have one ABLE account. Donations to the account are capped at $15,000 per year, the same as the gift tax exclusion. However, the cap pertains to the account not the donor. So, while a donor may give several people $15,000 per year, the ABLE account can only receive $15,000 a year in contributions.

The total balance in the account is restricted also. Account holders who are eligible for SSI benefits may only accumulate $100,000 in the account. Other account holders are held to the state limit for 529 accounts. Florida residents who do not receive SSI can save up to $418,000 in their ABLE account.

Funds in an ABLE savings account may be used only for disability-related expenses.

Building and Using an ABLE Account.

Anyone can contribute to the account, not just the parents of the disabled person.

For example, at age 22, Mary S. received severe, life-altering injuries in an accident. Her family may open an ABLE Account to pay for her future needs. Friends, family members, and others can then contribute to the account. When Mary enrolls in therapy needed to help her function better, she can withdraw money from her ABLE account to defray costs.

Donors can contribute using one of the following options:

  • Setting up a payroll deduction that sends money directly to the account,
  • By enrolling in an Automated Investment Plan (“AIP”),
  • Through electronic transfer from a bank account,
  • By depositing a hard copy check.

Additionally, money can be added to the account through gifting. In fact, an ENABLE Gift Certificate allows donors to send a contribution along with a personal message to the account owner. People may use UGIFT, a free online gifting service, to gift the ABLE account.

Account holders may withdraw funds for qualified disability expenses, including:

  • Education (including tuition for preschool through post-secondary schools);
  • Housing;
  • Transportation;
  • Employment training and support;
  • Assistive technology and related services;
  • Personal support services;
  • Health, prevention and wellness;
  • Financial management and administrative services;
  • Legal fees;
  • Expenses for oversight and monitoring;
  • Funeral and burial expenses; and
  • Other expenses to enhance the account owner’s quality of life.

Funds in an ABLE account can be moved to another ABLE account if necessary. The money may be rolled over to another eligible family member.

Special Needs Require Special Planning.

As a Florida attorney board certified in Wills, Trusts & Estates, Attorney John Mangan assists clients with estate planning questions, including special needs planning. To schedule an appointment, call us at 772-324-9050 or fill out our Contact Form. Our office is conveniently located in Palm City, Florida. We also help clients throughout Florida, including Stuart, Palm City, Hobe Sound, Jupiter, and Port St. Lucie.