We wanted to advise you about a few year-end housekeeping items for opening a new ABLE account or contributing to your existing ABLE account!
As a reminder, an ABLE account is organized under the IRS guidelines 529A. An ABLE account is a place where your loved one with a disability can have money above and beyond the limits for Medicaid. The money in an ABLE account will not be counted against them for SSI or Medicaid purposes. The money in the account grows tax free and has tax free distributions as long as the distribution is used to "achieve a better life for an individual with a disability."
- The deadline for your 2022 contribution to your child's ABLE account is 12/31/22.
- If you do not have an ABLE account and would like to open one, we can help. All paperwork must be received in good order by 12/23/2022 in order to be processed by year end. Book an appointment with us here and we'll get you started!
- The amount that can be contributed for 2022 is $16,000. If your loved one with a disability is working, they can contribute an additional $12,800 for 2022.
- Remember, this is a tax-advantaged account for individuals with disabilities whose disability began prior to age 26.
- You can pay rent out of an ABLE account without a 1/3 reduction to SSI.
For a more detailed understanding of how ABLE accounts work, take a look at this webinar- Should I Open an ABLE Account?