ABLE Savings Accounts For People With Disabilities

To find out if you are eligible for an ABLE account, you should contact the state's ABLE program. To be eligible for an ABLE account in Louisiana, you must meet the following criteria: 

• You must be a resident of Louisiana
• You must have been diagnosed with a qualifying disability before the age of 26
• You must be eligible for benefits under Social Security - either under the federal Supplemental Security Income (SSI) program or the federal Social Security Disability Insurance (SSDI) program or have a disability certification from a licensed physician.  
• You must have a disability that results in significant functional limitations. 
• You must have a disability that is expected to last for at least 12 months or result in death. 

Anywho is a resident of Louisiana and is 18 years of age can open an ABLE account. 

Anyone who meets the Social Security disability standard by age 26 can have an ABLE account.

If you are not on SSI or Social Security Disability you must swear under oath that by age 26 you had a physical or mental impairment, resulting in marked and severe functional limitations, and can be expected to result in death or has lasted or can be expected to last at least 12 months in a row, or are blind. You must keep a signed doctor’s statement with a diagnosis of the disability and be ready to show it to the ABLE program or to the IRS if it is asked for.

When you get an ABLE account it allows you to save money without having to worry about losing eligibility for certain government benefits. The money saved in an ABLE account can be used to pay for qualified disability expenses, such as medical care, housing, transportation, and education. Additionally, the money saved in an ABLE account is exempt from federal and state taxes, which can help people with disabilities save money and increase their financial security. 

Money saved in ABLE accounts can only be spent on certain types of expenses called Qualified Disability Expenses. Qualified disability expenses include things such as housing, transportation, education, employment training, assistive technology, and personal support services. Funds can also get used to pay for health, wellness, and financial management expenses. 

If you spend ABLE money on other things, it counts against asset limits for benefits like SNAP, SSI, Medicaid, etc.  If you withdraw ABLE money to pay for housing, it will count against the SSI resource limit if the withdrawn funds are not used up in the calendar month they are withdrawn.  

Qualified Disability Expenses include: 

• Education – This includes tuition for preschool to post-secondary schools.  Post-secondary schools are attended after completion of high school.  Vocational and technical schools are 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
• Other expenses which may be identified by the Internal Revenue Service

If you die with money in the account, the money goes to:

• Pay any bills for things the account is supposed to cover (Qualified Disability Expenses listed above). This includes your funeral expenses.
• If more money is left, it goes to Medicaid to pay back for any Medicaid you got since the account was opened.
• If still more is left, it goes to your heirs.

The maximum annual contribution limit for your account is $16,000.

You can exclude taxes on earnings and distributions (withdrawals) from the account. These deductions can help you pay for qualified disability expenses. 

Keep in mind, tax law changes have affected ABLE accounts:

• If you work, you can contribute your compensation toward your account along with the $16,000 limit. But, this additional contribution cannot be above the income poverty line for a one-person household.
• You may claim the Saver’s Credit for your contributions to your ABLE account.
• Your family can transfer or rollover funds from a 529 plan to your ABLE account. The 529 account can benefit you or another family member. This transfer counts toward the $16,000 annual contribution limit.

Social Security Benefits

As long as the balance in an account does not meet or exceed $100,000, the funds will not be counted as a resource for purposes of determining eligibility for SSI. In addition, if an account does meet or exceed $100,000, SSI will only be suspended; it will not be permanently canceled. Once the balance in the account goes below this $100,000 threshold, the SSI benefits can be reinstated.

The Louisiana Office of Student Financial Assistance maintains the ABLE program. 

You can set up the account online. Visit the website and create an account. Select the "ABLE Account" option from the menu. Enter your personal information, including your name, address, Social Security number, and date of birth. Select the type of account you would like to open.