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This week Congress finally passed a bill that will allow people with disabilties to work and to save without penalty.
The ABLE Act of 2013 allows people with disabilities and their families to create tax-exempt savings accounts to pay for expenses associated with disability, up to $14,000 a year. These expenses include unreimbursed medical and dental care, education, community support, employment training, assistive technology, housing and transportation.
For the first time, a disabled person will not have to be virtually impoverished to receive Social Security, Medicaid and other public funds. Up until now, individuals were disqualified from these programs if they had more than $2,000 in savings, retirement funds or other items of value, or if they earned more than $680 a month. A true disincentive to work or to save.
The savings accounts are similar to those for college savings, health-care savings, dependent-care savings and IRA’s. The accounts can be cumulative. College savings accounts in most states have a top limit of $300,000. With ABLE Accounts the first $100,000 will be exempt from the SSI prohibition. If savings exceed $100,000 the beneficiary would no longer be eligible for SSI but would continue to eligible for Medicaid.
The ABLE Act of 2013 passed by a large bipartisan margin, though it took 8 years to get there. ABLE stands for Achieving a Better Life Experience.
A version of this post appeared on my personal blog, Hear Better With Hearing Loss.
