By Fredrick P. Niemann, Esq. of Hanlon Niemann, a Freehold, NJ Special Needs Trust Attorney

Congress recently passed the ABLE Act to create tax-favored accounts for those who received a disability before the age of 26. Assets as well as distributions for qualified disability expenses from the account are generally disregarded when determining eligibility for most federal means-tested benefits, but limits and restrictions apply.

For Those That Are Not Familiar With the ABLE Act

The situation the ABLE Act wanted to address: Under current law, individuals with disabilities face significant barriers to finding and holding employment and living independently because their access to certain social safety-net programs can be lost once they establish a minimum level of savings and income, creating a disincentive to work.

The solution the ABLE Act provides: Tax-favored accounts for persons with disabilities that occurred before age 26. Assets in the account are disregarded for determining government benefit eligibility, but only the first $100,000 will be disregarded for purposes of SSI. ABLE Accounts can receive up to the annual gift-tax exemption per year (currently $14,000).

Have questions about the ABLE Act for someone you know that is disabled? Then contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or email him at Please ask us about our video conferencing consultations if you are unable to come to our office.