Able Act

ABLE Act: ABLE to Make a Difference?

In Columns, Features, My Life: Straight Up with a Twist by Tashauna Swanson3 Comments

Fan of 20 dollar bills with text overlay that reads: Able Act: Able to Make a Difference?

One late night last winter, I checked my email box to find a message from a website called Change.org, home to thousands of petitions created by individuals trying to rally people together for their specific causes. Admittedly, many reach my trash can before my eyes scan the words on the page.
Not because I don’t want to support every good cause in the world, but because I simply get a lot of automated emails from various places.

Apparently, it was one of those times the universe decided to throw something in front of me and make me take notice.

I stopped and read.

I am extremely glad something about that message caught my eye that night. It was asking me to support something that could directly affect my life called the ABLE Act.

I had no idea about it!

The ABLE Act, otherwise known as Achieving a Better Life Experience would allow people with disabilities to have a tax free savings account that will allow us to save for our futures and to have more equality in our lives.

This is a very simple explanation of the act, but I was immediately excited. When it comes to my finances, it’s something that always puts a bit of a knot in my stomach. Because I am on Supplemental Security Income, or SSI, I have an asset limit. If I go over that limit, I lose my benefits. I have always wanted the freedom to save money in the bank, just like everyone else does. I want to be able to have a savings account to put money in for things like dental checkups, educational courses, or other essential things people need to move forward in life.

You can bet I put my name in support of this ABLE Act petition.

Many individuals with disabilities share in this excitement. Many of us receive assistance from government programs like SSI, Medicaid, or SNAP benefits. Some of us are unable to work, can only work part time, have unpredictable health, or have a difficult time finding employers who will hire us for our skills because of our disabilities. We rely on these funds to live our daily lives, and frankly, for some people it isn’t even enough to live on.

While we can be grateful assistance exists to help us, these programs also sort of trap us into impoverished lives of inequality as a result of their outdated rules and regulations. For example, we are only allowed to have up to $2000 in liquid assets. If we go over the limit, we risk losing the help we get. So, saving more than that is out of the question.

Two thousand dollars doesn’t get anyone too far if they want to go to college, buy a house, or pay for emergency expenses that might crop up. It also doesn’t allow us much to work with if we need medications or assistive devices that aren’t covered–and anything medical related is far from cheap. This is a completely unrealistic limit in our economy today.

It’s basically like we have been set up on a flying trapeze without a safety net. This is an unfair thing to do to one of the most financially vulnerable populations in society, and it’s been going on for decades! It has also been too long since advancement has been made with rights pertaining to the disability community.

 

The ABLE Act may be the first step in the right direction.

 

A Deeper Look at the ABLE Act

The ABLE Act is an amendment to the tax code which will allow a person with a disability or someone on their behalf, to open a tax free savings account. This means interest accrued in the account will not be taxed, nor will the funds that are withdrawn for expenses.

The money saved in the account can be utilized for an array of necessary needs which include: housing, transportation, medical and dental costs, therapy, homecare, assistive technology, employment training, financial management, legal fees, education and any other expenses approved by the Secretary of the Treasury under regulations. The maximum amount of savings the account holder can have before losing benefits such as SSI and Medicaid is $100,000. Anything saved under that amount will not put benefits at risk.

There is also a cap on how much can be put into the ABLE Account on a yearly basis. An amount of $14,000 can be put into the account during the year before taxation will then be implemented.

The idea for the ABLE Act first came into existence about eight years ago. Through years of hardcore lobbying and attaining the attention and support of government representatives such as Senators Robert Casey, Jr., (D-PA), and Richard Burr (R-NC), the act finally reached the floors of the House and Senate for voting late last year.

The bipartisan support within both groups was overwhelming. It seemed to be a piece of legislation that finally had both Democrats and Republicans working together for something that was really going to benefit citizens in a large way–us.

President Barack Obama signed the ABLE Act in December, and now it is up to our individual states to figure out their implementations of it. It is hoped all states will have ABLE accounts available to us by the end of this year.

Able Act: Pros and Cons

The ABLE Act is an amazingly progressive step toward our equality and financial independence, one that took too many years to be put to a vote. We need to look at it as a win for most of the disability community, but it isn’t necessarily a win for everyone.

The positives of the ABLE Act include:

  • The ability to save up to $100,000.
  • It is tax free.
  • There isn’t a risk of losing SSI when over $2000 is saved.
  • Eligibility for Medicaid is maintained.
  • It will be easier and cheaper to set up than some kind of Special Needs Trust.
  • We can finally have some financial cushion for our necessities.

 

The negatives of the ABLE Act include:

  • Individuals who are diagnosed with a disability or become disabled after 26 years of age are ineligible for an ABLE Account.
  • Contributions to the account cannot exceed $14,000 per year or the account will lose ABLE Account status.
  • Upon the death of the disabled beneficiary, all of the funds will be paid back into Medicaid.

 

In my opinion, the positives do outweigh the negatives, not only in number but in value. I do have a few issues with the points I listed in the negative category though.

I can’t help but feel anxious for individuals in the future who become disabled after age 26. What about the hundreds of thousands of people who are diagnosed with MS every year? Or those who become paralyzed from strokes or accidents? Should they be left without a way to save?

Should they be made to live as if the ABLE Act doesn’t exist because of a rule that excludes them?

This is one area where there needs to be some reform. I am of a mindset where if something is going to be done, there should be great lengths taken to do it right the first time. I’m not saying this isn’t a great start, but why the age rule? How long will it take, and how many people will need to lobby to get that rule amended?

The second negative point doesn’t bother me quite as much as I don’t feel it compares to the first in its importance. $14,000 is a reasonable yearly limit on savings but I feel we should have the option to save more in a year if we are able. For instance, what if we are gifted a large sum through an inheritance?

Third, I do understand where the ABLE Act is coming from in delivering money back to Medicaid in a way upon the beneficiary’s death. The government supports our needs, so if we save money into the account, upon our death the funds go to pay back Medicaid for resources received.

But, if I work and save money or if it was gifted to me–if my life should end I would like for my money to go to some person or cause that I value. I’d want my savings to be turned over to my family, or be put into college funds for my best friend’s children, or be donated to charities.

If I finally have the opportunity to put my money in savings like anyone else, I also want the opportunity to determine where it goes when I die.

A Closing Thought on the ABLE Act

As a part of the disability community, I feel that too often our group is limited in our choices. A lot of this has to do with how programs and laws pertaining to us are set up in our society and government. This boxes us in, and holds us back from reaching our full potential. Yes, reaching our potential is very much up to us as well, but there are things we are unable to change in our lives due to policies made by officials who usually have no idea what it’s like to be in our shoes.

We want to be as independent as possible and we will fight every day for it. We aim to be active members of society, living in our own homes and not forced to live in institutions that will serve as a detriment to our mental states and independence.

I hope one day, we won’t have to be seen as less capable than anyone else. We will be able to work without worrying whether or not our safety net will be taken away or if we will have enough money for groceries at the end of the month. We won’t have to jump through proverbial hoops to get all of our medical needs met.

I still am very excited about the ABLE Act, and I’m looking forward to seeing lives be positively affected once these accounts are available. Hopefully, this is only the beginning of bigger things to come that will allow us to really feel as if we matter in this country.

What are your thoughts on the ABLE Act? Is this a push in the right direction? Leave your comments below! I’d love to know.

 

 

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  • Jack Lancellotta

    CONGRATULATIONS to all those
    advocates that worked tirelessly to ensure some form of financial relief and
    personal security is afforded to our Disabled American people. Yes, although not
    perfect legislation, the age threshold of 26 is a sticky point in dis-allowing
    full coverage or opportunity to those – – over that lean age – who also struggle
    with ‘ disabilities’ to have some form of individual financial relief and a
    minimum of economic security. However this is a great accomplishment in itself
    within the labyrinth world of political bureaucracy on the federal level that
    offers to those truly disabled people after years of restrictive and unfair
    rule-making authority, the human and personal sense of a resemblance of economic
    independence, although within a genuinely structured system. Although we hope
    the developing new rule applications – for the A.B.L.E. Act – by the United
    States Treasury will be promulgated sooner than later, in the interim, we all
    should join together and look into recent proposals such as the SSI SAVERS ACT
    and Supplemental Security Income Restoration Act to be re-introduced into
    Congress with such sound and pronounce momentum for these types of upgrades to
    existing legislation and rule-making. With such legislative action as the SSI
    SVERS ACT or SUPPLEMNTAL SECURITY RESTORATION ACT being re-introduced into
    Congress on a strong bi-partisan effort, a simple, needed and well overdue
    allowance to those Disabled individuals over the age of 26, would actually
    possess some independent (private) savings – with no reflection on ‘tax
    expenditures’ or losses to the Treasury – and shed the offensive and oppressive
    burden of long-term penalties and threats of medical expulsion for simple things
    as accepting a meal or small donation under the ‘In-Kind Support &
    Maintenance’ Rule, which upon minimum examination, is quite repulsive to even
    the average American. Let’s continue the realistic encouragement of the proper
    modernization of our disability regulatory process and coalesce with such
    outstanding legislators to bring about a formula that replicates the SSI SAVERS
    & SSI RESTORATION ACTS in the 114th United States Congress (2015-17).

  • Great comment, and thank you for that information! 🙂 I will have to be doing more research now! We need to definitely keep the ball rolling to better improve the systems in place that are there to help us.

  • Jack Lancellotta

    Thank You, Rangeelichick for your kind words of support … sure thing – we all need to keep the ‘ball rolling’ with the many archaic elements to the ‘systems’ now in place for our Disabled American Citizens … the SSI has too many ancient parts to it as
    with the $2,000 assets tests that hasn’t been modifies since 1989 … or
    their-Kind Support Rule that dates back to 1972 which penalizes innocent people
    that share some food (meals) with family, friends or neighbors … or how about
    that $1,500 lousy dollar threshold on a burial or life insurance policy that
    penalizes Rhode poor folks – kicking em right off their Disability Benefits …
    is that fair .. is that proper .. let alone where the compassion may be
    found.

    Yep, America is got to WAKE-UP and see that our poor elder and Disabled Americans
    need to maintain at least a decent standard of living … since we / they pay
    TAXES of some kind as well.

    Thanks
    again for your optimistic show of support!!!

    Jack Lancellotta
    RI JAYCEE / JCI Association