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Only those who became disabled by age 26 have been eligible for ABLE accounts. But Congress raised the age to 46, so more military veterans and others can qualify as of 2026.
Disabled Americans recently scored a victory when Congress approved an expansion of state-based accounts that let them work and save money without risking the loss of public benefits like Medicaid.
The change means an estimated six million more people, including about one million military veterans, will eventually qualify for the tax-favored accounts, advocates for disabled people say. The accounts, known as ABLE accounts, are named after the 2014 law that created them, the Achieving a Better Life Experience Act.
Forty-six states and Washington, D.C., offer ABLE accounts, which first became available in 2016 and are loosely modeled on 529 college savings accounts. But saving in ABLE accounts has been somewhat slow to catch on, partly because they have been limited to people who became disabled before the age of 26.
Now, the ABLE Age Adjustment Act, included in the omnibus spending bill passed in December, has raised the threshold for the onset of a qualifying disability to age 46. That means people can be eligible if their disability occurred after their mid-20s, in a car accident, say, or from a neurological disease they developed, like multiple sclerosis. It may also help people dealing with the lingering effects of Covid-19, said Thomas Foley, executive director of the National Disability Institute.
The accounts let people with disabilities save and invest for current expenses and future needs, including housing, education, transportation and legal costs, without the funds disqualifying them from need-based federal help like Medicaid and Supplemental Security Income. In general, a disabled person can’t have more than $2,000 in savings or other assets to qualify for those programs. But money in an ABLE account doesn’t count toward that total.
“It’s a safe place to save money,” Mr. Foley said.
The age expansion was crucial for the ABLE program overall, supporters say. A 2019 report from the National Association of State Treasurers warned that participation was too low to maintain affordable fees for ABLE accounts and sustain the programs over the long term. The association’s charitable arm, the NAST Foundation, has started several initiatives to promote awareness of the accounts.