Great news! The Georgia House of Representatives took the first step toward making ABLE Act savings accounts a reality in our state (House Bill 768). The legislation was passed unanimously on February 23rd, paving the way for greater financial security for those with disabilities. It now heads to the Senate for a vote.
Under the Achieving a Better Life Experience (ABLE) Act, individuals with disabilities in Georgia will soon have the opportunity to begin saving their own money toward future health-care costs, housing expenses, transportation, education, and other needs without jeopardizing eligibility for critical government benefits.
The law that initially provided for the creation of ABLE Accounts passed nationally in 2014. Since then, 35 states have completed the process to allow families to open and operate those accounts on a local level.
The proposed legislation would set up a Georgia ABLE Program Corporation, governed by a board of directors that would administer the program. Eligibility under the ABLE Act is limited to those 26 and under, with a $14,000 cap on yearly contributions. A total of $100,000 tax-free can now be accumulated in a special ABLE account, which is limited to one per person.
Prior to the passing of the ABLE Act on a national level, individuals with disabilities were unable to have assets totaling more than $2,000 or earn more than $680 per month without forfeiting eligibility for government programs like Medicaid. This was worrisome for families, considering that Medicaid is often the only healthcare option available for those with significant disabilities.
To protect such benefits, parents of disabled children would often go to great lengths to avoid putting assets, donations or inheritances in their child’s name. But now, under this law, families will have new opportunities to help their child save for the future while keeping much needed government benefits intact.
Additionally, the ABLE Act offers another exciting benefit in that disabled individuals will no longer be deterred from pursing gainful employment opportunities in the local community. Currently, individuals who had some capacity to work and contribute to society were often deterred from doing so out of fear they would cross the income thresholds of their benefits and lose everything. Now, young people with disabilities can take a chance in pursuing meaningful work opportunities without sabotaging their financial future.
As Savannah special needs attorneys, we feel this is a wonderful law and a positive step forward in empowering disabled children and young adults. An ABLE Account combined with solid planning tools such as Special Needs Trusts now affords families with even more protection and flexibility when saving for the future. A good special needs attorney can help families utilize these tools for maximum savings opportunities and peace of mind.