ABLE Account Decision Guide Series
Am I ABLE-eligible and How Do I Open an Account?
An ABLE account is owned by a person with a disability. Family, friends, the ABLE account owner and/or a Pooled or Special Needs Trust may contribute to the ABLE account. ABLE savings may be spent on qualified disability expenses. ABLE savings are not considered a countable resource for public benefit programs. ABLE savings up to $100,000 is not a countable resource for Supplemental Security Income (SSI) beneficiaries.
There are three ways to establish ABLE eligibility. The person may open the account at any age, but must be:
- eligible for SSI based on disability or blindness that began before age 26; or
- entitled to Social Security Disability Insurance (SSDI) benefits based on disability or blindness that began before age 26; or
- person who has a disability certificate from a licensed physician (doctor of medicine or osteopathy, a doctor of dental surgery or dental medicine and, for some purposes, a doctor of podiatric medicine, a doctor of optometry or a chiropractor) stating that the disability condition began before age 26.
You should also note:
- The “eligible for SSI” criteria is met if the person receives 1619(b) Medicaid after losing SSI cash payments, due to work and wages, see https://www.ssa.gov/disabilityresearch/wi/1619b.htm. The criteria may also be met if benefits were suspended for less than 12 months due to technical reasons. Examples could include excess resources, deemed income, excess unearned income, proceeds from life insurance policies, unemployment compensation.
- The “entitled to SSDI” criteria is met if the person is in an extended period of eligibility, but in a suspended status or receives Extended Medicare Coverage after losing SSDI due to work and wages. See https://www.ssa.gov/disabilityresearch/wi/extended.htm and https://choosework.ssa.gov/blog/2019-01-29-myth-busted-continuation-of-medicare-coverage.
- References to SSDI include Disability Insurance Benefits, based on the earnings record of the person receiving benefits; Childhood Disability Benefits, based on the earnings record of a parent who is disabled, retired, or deceased; and Disabled Widow’s or Widower’s Benefits, based on the earnings record of a deceased spouse.
- The certification of disability, completed by the licensed physician of medicine or osteopathy, a doctor of dental surgery or dental medicine and, for some purposes, a doctor of podiatric medicine, a doctor of optometry or a chiropractor must state that the person has a disability which results in marked and severe functional limitations and has lasted or is expected to last for 12 consecutive months or is likely to result in death. The certification must include a physician’s diagnosis and be available to the IRS or the ABLE plan if requested.
- The medical criteria for establishing an ABLE account uses the same standards that Social Security uses to establish disability for children, but it is used for both children and adults for ABLE accounts. The impairment or combination of impairments must be so severe that it meets or equals the severity of a medical condition listed in Appendix 1 of Subpart P of 20 CFR part 404. The listing, which is broken down by body system, can be found at https://www.ssa.gov/OP_Home/cfr20/404/404-app-p01.htm.
- The SSA also has a listing of Compassionate Allowance Conditions which are deemed to meet the severity of disability requirement.
- A person may have one ABLE account opened in their name, at any age.
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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.