The amount that people with disabilities can deposit in an ABLE account each year without jeopardizing eligibility for needs-based governmental benefits will rise from the current $14,000 to $15,000 starting in 2018.

Under the law, total annual deposits to ABLE accounts are limited to the federal gift tax exclusion limit set by the IRS. The federal gift tax exclusion will rise from $14,000 to $15,000 in 2018.

Created by Congress via the passage of the Achieving a Better Life Experience (ABLE) Act in 2014 and modeled after popular 529 college savings accounts, ABLE accounts allow people with disabilities and their families to save up to $100,00.00 in accounts for disability related expenses without jeopardizing their eligibility for Medicaid, Supplemental Security Income (SSI), and other government benefits.  Money in ABLE accounts can be used to pay for qualified disability expenses including education, health care, transportation and housing, among other things. Interest earned is tax-free. (Other blog posts discussing ABLE Accounts can be found here: People with Disabilities Now Able to Create Their Own Special Needs Trusts, here: Understanding ABLE: Achieving A Better Life Experience Act Explained, here: How Does an ABLE Account Impact Eligibility for Public Benefit Programs Based Upon Financial Need? , here: SSA Publishes Regulations for ABLE Accounts Owned by SSI Recipients  and here: Center for Medicare and Medicaid Services Provides Guidance on ABLE Accounts

ABLE accounts may be opened by anyone with a disability as long as the disability began before the person turned 26.

ABLE programs are set up by the individual states. So far, twenty-nine states and the District of Columbia have ABLE programs. The New Jersey Achieving a Better Life Experience (ABLE) Act became law in 2016. However, individuals with disabilities with onset before the age of 26 can create an ABLE account through any state’s program no matter where they live.

UPDATED ON DECEMBER 5, 2017: Both the Senate and House versions of the Tax Bill contain identical provisions that increase the gift tax exclusion to $28,000 per year, adjusted upward for inflation.

Since the limit on how much one can put into an ABLE account is tied to the gift tax exclusion, if the tax bill passes as currently predicted, the annual ABLE account contribution will be $28,000 per year beginning in 2018, up from $14,000 in 2017.

That means that someone who is ABLE-qualified this month who has a small inheritance or personal injury jury award in December could allocate $14,000 this month, December 2017, and put an additional $28,000 in January 2018, to legally shelter $42,000 in total.

For additional information concerning special needs trusts and disability planning, visit:

NJ Special Needs Trusts and Disability Planning