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This article was contributed by Jennifer Mahan, ASNC Director of Advocacy and Public Policy.

The North Carolina General Assembly has introduced legislation to authorize 529 savings plans for individuals with disabilities, as allowed under the congressional ABLE Act of 2014. Advocacy groups, including the Autism Society of North Carolina, are supporting the passage of legislation, which also has broad support across the North Carolina General Assembly. Senators Tom Apodaca, Tamara Barringer, and Ralph Hise are the primary sponsors of Senate Bill 367.

The federal ABLE Act, Achieving a Better Life Experience, allows states to set up savings programs that are similar to 529 college savings but specifically for people with significant disabilities. ABLE savings plans would allow people with disabilities, their families, or friends to save money for future needs such as support, housing, services, health care and personal care, without jeopardizing eligibility for other needed benefit programs. People of any age who acquired their disability before the age of 26 are potentially eligible. SSI and SSDI recipients would be eligible automatically; other people who have significant disabilities will have to meet a disability standard of proof established by Treasury regulations that will be written this year.

The basics

• Eligibility: An eligible individual is a person (1) who is entitled to benefits on the basis of disability or blindness under the Supplemental Security Income (SSI) program or under the Social Security disability, retirement, and survivors program OR (2) who submits certification that meets the criteria for a disability certification (to be further defined in regulations).
• An eligible individual’s disability must have occurred before the age 26.
• An eligible individual may have one ABLE account, which must be established in the state in which he resides (or in a state that provides ABLE account services for his home state).
• Contributors: Any person, such as a family member, friend, or the person with a disability, may contribute to an ABLE account for an eligible beneficiary.
• Limits: An ABLE account may not receive annual contributions exceeding the annual gift-tax exemption ($14,000 in 2015). A state must also ensure that aggregate contributions to an ABLE account do not exceed the state-based limits for 529 accounts.
• Qualified disability expenses are any expenses made for the benefit of the designated beneficiary and related to his/her disability, including: education, housing, transportation, employment training and support, assistive technology and personal support services, health, prevention and wellness, financial management and administrative services, legal fees, expenses for oversight and monitoring, funeral and burial expenses, and other expenses, which are approved by the Secretary of the Treasury under regulations.
• Earnings on an ABLE account and distributions from the account for qualified disability expenses do not count as taxable income on federal tax returns.
• Assets in an ABLE account and distributions from the account for qualified disability expenses would be disregarded when determining the designated beneficiary’s eligibility for most federal means-tested benefits.

Disability Scoop outlines the ABLE Act here, and the National Disability Institute has an informative, 10-minute video explanation as well.

Show your support

ACTION: While the ABLE Act Authorizing Bill has broad support in the NC General Assembly, we do encourage you to ask for your own legislators’ support.

1. Check to see whether your NC General Assembly senator has sponsored or co-sponsored the bill. If they have sponsored the bill, be sure to THANK them for doing so and let them know you appreciate their support of the ABLE Act.
2. If your senator is not a sponsor, ask them to vote for it. Talking points on the bill are below. The best thing you can do is tell them what it will mean to be able to set aside savings for future needs and how important it is to you personally.

Not sure who represents you in the General Assembly? Type in your address on the Senate and House maps to find your district and members. The first two maps are for the General Assembly; ignore the last map for this bill.

Talking points

• ABLE lets individuals, families and friends to save for future needs for things such as housing, transportation, training, assistive technology, support services, health care, and other expenses to help people live.
• It allows these savings for future needs without jeopardizing eligibility for most federal benefit programs.
• Earnings on an ABLE account and distributions from the account for qualified disability expenses do not count as taxable income on federal tax returns.
• ABLE accounts promotes self-determination, financial responsibility, and thoughtful planning for the future.

Have questions about this legislation or other public policy issues? Contact Jennifer Mahan, ASNC Director of Advocacy and Public Policy, at jmahan@autismsociety-nc.org or 919-865-5068.

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