ABLE: An Account to Overcome the SSI Resource Limit for Adults with Disabilities

A Brief Overview

  • The Stephen Beck Jr. ABLE (Achieving a Better Life Experience) Act of 2014 allows individuals to save up to $18,000 annually without affecting their public benefits.
  • An account holder may save up to $100,000, bypassing the $2,000 resource limit for Supplemental Security Income (SSI), Medicaid, and other public benefits programs.
  • Funds may be used for qualified disability expenses (QDEs) that improve or maintain the account holder’s health, independence, and/or quality of life.
  • ABLE accounts are savings accounts and the account holder may choose to distribute a percentage of the funds to investments, including stocks, bonds, and mutual funds.
  • Forty-five states and the District of Columbia have ABLE Savings Plans with some states accepting out-of-state enrollment.
  • Washington State ABLE Savings Plan began in 2018, following Oregon ABLE Savings Plan, so some Washingtonians signed up early through that option or through the national ABLE For ALL Savings Plan.
  • Download this cheat sheet to Qualified Disability Expense (QDE) Tracking Form.

Full Article

Living with a disability can be difficult and costly. Adults who receive benefits from the Social Security Administration because of disability often are challenged to improve their life circumstances because of a $2,000 resource limit. This limit means that a person receiving payments from Supplemental Security Income (SSI) or the Social Security Disability Insurance (SSDI) program cannot have a bank account balance or any other resources on hand that exceed $2,000, without losing part of their benefit.

Savings of $2,000 or less can be limiting for someone who might want to move into a new home, invest in a vehicle or save for higher education or a vocational training program.

The government provides a way for individuals with disabilities to overcome this barrier and save money. The Stephen Beck Jr. ABLE (Achieving a Better Life Experience) Act of 2014 allows individuals to save up to $18,000 annually without losing benefits. ABLE is modeled after college savings plans. The savings and/or investment account bypasses the SSI resource limit and can grow interest tax-free.

There are some restrictions:

  • The account holder must meet criteria for a disability that began before age 26.
  • The account may not receive more than $18,000 per year.
  • If the account balance exceeds $100,000, Social Security benefits are impacted but Medicaid benefits will remain in place.
  • Most accounts have a total lifetime balance limit of $500,000.

How can money in an ABLE account be used?

ABLE account money may not be spent on just anything. Generally, the funds can be used to pay for expenses that may help improve or maintain health, independence and/or quality of life. These are called Qualified Disability Expenses (QDEs). In this webinar recording, presented by ABLE National Resource Center, the ABLE expert presenters noted that “QDEs should be broadly understood and should not be limited to expenses for which there is a medical necessity or expenses that provide no benefits to others (outside of the benefit to the beneficiary).”

Here are a few examples of qualifying expenses: 

  • Housing
  • Education
  • Transportation
  • Personal support services
  • Assistive technology
  • Health and wellness
  • Employment training and support

ABLE accounts are subject to IRS or SSI audits, so the account holder should keep a record of how money has been used, including:

  • the purpose or cause of the expense
  • how the expense relates to improving or maintaining health, independence, and/or quality of life
  • a copy of the proof of purchase or payment

PAVE has created a QDE Tracking Form to make it easier to keep track of your ABLE account activity.

What type of financial account is ABLE?

The ABLE account is a savings account, insured by the Federal Deposit Insurance Corporation (FDIC). A chosen percentage of funds in the account may also be allocated as uninsured investment money. The account holder can choose a low-, median-, or high-risk investment strategy. Low-risk is the safest, most conservative option, with the lowest possibility for return. A high-risk investment might make more money but also could lose more. A median-risk investment is somewhere in between. Based on the account holder’s choice, the money is automatically allocated into some combination of stocks, bonds, and mutual funds.

An individual considering these options may want to consider how long the money will be in the market and risk tolerance. ABLE does warn that invested money is not insured and that money, including principle, may be lost over the course of an investment period.

The account holder, family and friends can deposit funds into the account using post-taxed dollars. Contributions are not federally tax deductible; however, some states may allow for state income-tax deductions for contributions made to an ABLE account.

Where are ABLE programs available and open for enrollment?

Although the program was federally enacted, ABLE is state-run. Washington’s program opened for enrollments in July 2018. So far, enrollments have been low, with the State Department of Commerce reporting that only a few hundred people have opened accounts. Commerce estimates about 30,000-50,000 people in Washington are eligible for the ABLE Savings Plan and have the financial assets to open an account.

Forty-five states and the District of Columbia have ABLE Savings Plans. Oregon’s plan was a year and a half ahead of Washington’s, so some Washingtonians signed up early through that option or through the national ABLE For ALL Savings Plan.

Individuals can shop around for the best program to meet their needs, and some states accept clients from all 50 states, including Virginia, Ohio, Nebraska, and Tennessee. Virginia is among the few states that issue a debit card for the account. The ABLE National Resource Center provides tools for reviewing the various state programs to find the best fit. Washington State ABLE Savings Plan links directly to a clickable form to determine eligibility.

When does the ABLE Age Adjustment Act go into effect?

With the 2023 passing of the Omnibus Spending Bill, the ABLE Age Adjustment Act was passed into law. Beginning on January 1, 2026, the age of onset of the disability will increase to 46 years of age.

Additional Resources:

Dial 711 for Telephone Relay Service (TRS) or teletypewriter (TTY), or call: