House acts on savings accounts for Americans with disabilities
WASHINGTON – Area congressmen were among those overwhelmingly voting this week for legislation that would allow Americans with disabilities to establish tax-free savings accounts to pay for qualified medical, housing, transportation, and job-training expenses.
The Achieving a Better Life Experience (ABLE) Act of 2014 passed the House 404-17.
“Under current law, people with disabilities are discouraged from saving or seeking gainful employment because doing so puts them at risk of losing means-tested Medicaid and SSI benefits,” said Congressman John Shimkus, R-Collinsville. “By giving individuals with disabilities, and families with disabled children, the tools and the opportunity to play a bigger role in their support needs, the ABLE Act empowers people with disabilities to live and work more independently and improves their quality of life.”
If passed by the Senate and signed by the President, states would have the option to establish an ABLE program beginning in 2015 under the new law. An estimated 54 million eligible individuals may then go to their financial institution to establish an ABLE account, modeled after current Section 529 savings accounts commonly used for education expenses. To be eligible for an ABLE account, individuals must: 1) be severely disabled before turning age 26, based on a marked and severe functional limitation; or 2) receive benefits under the SSI or Disability Insurance programs.
Congressmen Rodney Davis, R-Taylorville, explained his support.
“Americans with severe disabilities can face very uncertain futures after the loss of their their parents, other loved ones, or caregivers. The ABLE Act would create a new, much-needed program to give families the ability to save money through a 529 plan to ensure that the long-term costs for things like housing, therapy, or rehabilitation are covered without fear of losing disability-related government benefits,” Davis said.
Similar incentives are already offered for families to cover future expenses such as college or retirement, “so it only makes sense to provide some peace of mind by extending benefits to those planning for the long-term care of individuals with severe disabilities,” Davis said.
