ABLE Account Decision Guide Series
Determining Whether Something is a Qualified Disability Expense (QDE)
An ABLE account allows the ABLE account owner, family and friends and “persons” (including trusts, by IRS definition) to make contributions into an ABLE account. Those contributions can later be used to pay for items and services that meet the qualified disability expense (QDE) criteria set by federal law and regulation.
- Employment training and support
- Food (as clarified by SSA) https://secure.ssa.gov/apps10/poms.nsf/lnx/0501130740
- Assistive technology and personal support services
- Health, prevention and wellness
- Financial management and administrative services
- Expenses for ABLE account oversight and monitoring
- Legal fees
- Funeral and burial
- Self-employment expenses: How can I use my ABLE account to start or grow my business? A SSI beneficiary may find it difficult to save for all ongoing business expenses without going over their $2,000 countable resource limit. Money may be saved in an ABLE account to pay for quarterly income taxes, a lease, rent or for other business-related expenses. Best practice: save for business expenses with a business checking account and pay for expenses each month. Expenses that can only be paid quarterly or annually (that will likely be more than the $2,000 resource limit, may be saved for within ABLE.) This allows room for some ABLE savings to be saved long term. Selecting an ABLE investment option may allow for tax-free investment growth too. Pay for qualified disability expenses directly from the ABLE account and keep receipts for at least three tax seasons.
- And other expenses approved through the U.S. Treasury Department/IRS regulations (proposed regulations from 2015 add “basic living expenses” to this list).
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General QDE Guidance for ABLE Account Users
This guidance should be useful to the ABLE account owner and to their circle of support who is assisting, advising or making decisions with the ABLE account owner.
Chose one of the following common QDE Categories to continue:
- An Educational QDE
- Rent or Mortgage Payments a QDE Through ABLE Account , if Designated Beneficiary Gets Supplemental Security Income
- Assistive Technology (AT) as a QDE
- Purchase of Vehicle as a Transportation QDE
- Supplies for COVID-19 as a Health, Prevention and Wellness QDE
- A Range of Everyday Expenses, Including Food, as Basic Living Expense QDEs
- Help with Managing the ABLE Account as a QDE for Financial Management, Administrative Services, Account Oversight or Monitoring
Note: Our ABLE Decision Guide Series is designed as an aid to decision making as it relates to establishing and using an ABLE account. This document does not cover every possible issue related to the topic and is not a substitute to more in-depth analysis that may be required in some cases.