Washington, D.C. — The Senate Finance Committee today advanced the ABLE to Work Act and the ABLE Financial Planning Act – two bills sponsored by Senator Bob Casey (D-PA) and Senator Richard Burr (R-NC) aimed at enhancing ABLE accounts. The ABLE to Work Act builds on the success of the ABLE Act by making it possible for people with disabilities who work to save an additional amount in an ABLE account without risking loss of benefits. The ABLE Financial Planning Act will allow financial rollovers from 529 college savings plans to ABLE accounts.
“Advancing these pieces of legislation moves us one step closer to building on the foundation of the ABLE Act,” Senator Casey said. “Fundamentally, these efforts are about breaking down barriers for those with disabilities so they have a fair shot to achieve their dreams.”
“I am excited this legislation to strengthen the ABLE Act has advanced out of committee and can soon be considered by the full Senate,” said Senator Burr. “The ABLE to Work Act is about promoting employment and independence for people with disabilities. It will allow people with disabilities to save more money if they have a job and earn an income, and it will also make them eligible for the Saver’s credit. I’m also pleased to see the Committee advance the ABLE Financial Planning Act, which will allow families with a special needs child to have more control over their financial futures. I’m urging my colleagues in the Senate to pass this legislation as soon as possible.”
Background:
The ABLE to Work Act expands on the goals of the ABLE Act by encouraging work and self-sufficiency. The legislation allows individuals and their families to save more money in an ABLE account if the beneficiary works and earns income. Specifically, an ABLE beneficiary who earns income from a job could save up to the Federal Poverty Level, which is currently at $11,770. The bill will also allow ABLE beneficiaries to qualify for the existing Saver's Credit when they put savings in.
Text of the ABLE to Work Act is available here.
The ABLE Financial Planning Act would allow families to rollover savings in a 529 college savings plan into an ABLE account. Many families save for a child’s college education by opening a 529 account, sometimes before their child is even born, only to learn later that their child has a severe disability like autism. In other cases, a child could incur a disability from a tragic accident. In such instances, these families have funds trapped in a 529 that they could use to help cover their child’s lifelong expenses. If they withdraw the funds for anything other than college expenses, they face taxes on their withdrawals. The ABLE Financial Planning Act would help these families by allowing them to rollover the funds in their 529 account into an ABLE account for their child.
Text of the ABLE Financial Planning Act is available here.
In 2014, the bipartisan group of lawmakers led the effort to pass the Achieving a Better Life Experience (ABLE) Act, which lets families who have a child with a disability save for their long-term care through 529-style savings accounts. The ABLE Act was a significant step forward and has been heralded as one of the most important pieces of disability legislation since the Americans with Disabilities Act (ADA).
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