New York State Comptroller Thomas P. DiNapoli today urged Congress to increase the eligibility age from 26 to 46 for individuals who can participate in the Achieving a Better Life Experience (ABLE) program, a savings and investment tool for individuals with disabilities. NY's ABLE program, which launched just over a year ago, already has approximately $3 million in assets saved by individuals and their families to pay for medical and living costs.
"People who become disabled later in life, including many of our veterans, face the same challenges and same expenses as those disabled from accidents or illnesses as children or young adults," DiNapoli said. "Since launching our program a year ago, raising the age of who can participate is one of the major changes requested by New Yorkers with disabilities who want a more secure financial future. Raising the eligibility age from 26 to 46 is a common sense idea that would allow this program to help even more people."
The legislation before Congress, the ABLE Age Adjustment Act (H.R. 1874 / S.817), amends the Internal Revenue Code for state-sponsored ABLE programs, to increase the age threshold for eligibility for the programs from 26 to 46. According to the National Association of State Treasurers, raising the age for the ABLE program nationally would increase the number of people who could save through the program by six million.
The legislation is currently with the Senate Finance Committee and the House Ways and Means Committee. Five of the bill's sponsors are from New York, including Sen. Kirsten Gillibrand, as well as U.S. Reps. John Katko, Sean Patrick Maloney, Jose Serrano and Yvette D. Clarke.
"The ABLE program has been a critical tool for helping disabled New Yorkers and their families save and invest in their futures. I have consistently fought for the ABLE program in the Senate and am proud to support expanding the program's age limit to assist New Yorkers who become disabled later in life," said Senator Kristen Gillibrand (D-NY). "Congress should be passing legislation like this to support our disabled communities across New York state, and I will continue to fight for common sense legislation and programs that will support disabled New Yorkers."
Congressman John Katko (NY-24) said, "During my time in Congress, I have consistently led efforts to support ABLE programming, which helps empower individuals with disabilities and ensure they have the tools necessary to save and plan for the long-term. I will always be a champion for individuals with disabilities, and applaud Comptroller DiNapoli for his commitment to this program and to making sure individuals of all abilities in New York have the tools they need to live more independent lives."
"The current age limit for the ABLE program doesn't account for a lot of folks who acquire their disability after age 26," said Congressman Sean Patrick Maloney (NY-18). "We're talking about millions of Americans including veterans and folks who were hurt on the job. We can't keep these folks out of the program simply because of their age. People with disabilities shouldn't be forced to choose between saving for their future and getting critical public assistance right now."
"As a veteran, I am proud to join State Comptroller DiNapoli and my colleagues from New York in supporting an eligibility expansion for the NY ABLE Program, which has already been a success in its first year," said Congressman Jose Serrano (NY-15). "Raising the eligibility from 26 to 46 and allowing people who become disabled later in life to join, which would include many veterans, would make the program more inclusive. I will continue to support the ABLE Act here in Washington and look forward to its continued success."
New York's Program Celebrates One Year
The NY ABLE program was signed into law in December 2015 and started operating and investing funds in 2017. DiNapoli's office oversees the program and investments. The legislation was sponsored by State Sen. David Carlucci (D-Rockland/Westchester) and Assemblywoman Aileen M. Gunther (D, I, WF-Forestburgh).
"Millions of people with disabilities and their families depend on a wide variety of public benefits for income, health care and food, and housing assistance. By passing the ABLE Act in New York state we made a real difference in the lives of people with disabilities, allowing them to create a tax-exempt savings account to help them maintain their independence and improve their quality of life. Now we have an opportunity to expand the program with federal legislation, and I thank Comptroller DiNapoli for speaking out in support of the bill before Congress," said Senator Carlucci (D-Rockland/Westchester).
Assemblywoman Gunther (D, I, WF-Forestburgh) said, "I am proud to have sponsored the ABLE Act in the Assembly. I would like to thank State Comptroller DiNapoli for his tremendous work in implementing these ABLE accounts statewide. This was no small undertaking. However, the federal law does require New York to restrict eligibility to those diagnosed with a disability before they turn 26 years old. This can be a major impediment for people with traumatic brain injuries or post-traumatic stress disorder who wish to take advantage of these accounts. I join the State Comptroller in calling on the federal government to increase this age limitation or remove it completely."
How the Program Works
The NY ABLE Program allows New Yorkers with disabilities to save money in their own names without risking their Supplemental Security Income (SSI), Medicaid and certain other means-based benefits.* NY ABLE accounts, also known as 529A accounts, can be opened with a minimum contribution of $25.
The annual contribution is capped at $15,000. Account owners who are employed can contribute an additional $12,060 or their annual income, whichever is less. The maximum account balance is $100,000.
Contributions can be made by eligible individuals, family members or friends, but are not tax-deductible.
To be eligible, an individual must have a disability that was present before age 26. Participants must be eligible for SSI or Social Security Disability Insurance (SSDI), be blind, have a significant disability documented by a physician, or have a disability that is included on the Social Security Administration's Compassionate Allowances Conditions list. New York residency is required and only one account per individual is permitted.
The program was modeled after the 529 College Savings Program and adopted under the federal Stephen Beck Jr. Achieving a Better Life Experience Act of 2014. New York is one of 40 states in the country that offer this type of program. NY ABLE provides a variety of investment options.
Earnings and distributions from NY ABLE accounts are tax-free provided the funds are used for qualified disability expenses.** These include costs for education, health and wellness, transportation and housing, among other expenses. Users can access funds in several ways, including an optional checking account and debit card.
To set up an account, go to: https://www.mynyable.org/ or call 1-855-5NY-ABLE. A copy of the program's disclosure booklet and participation agreement is available at https://cdn.unite529.com/jcdn/files/NYB/pdfs/programdescription.pdf
*ABLE programs are intended to supplement other governmental and private benefits, including SSI and Medicaid. Please consult with your benefits administrator for additional information.
**Earnings on non-qualified withdrawals may be subject to federal and state and local income tax and a 10 percent federal penalty tax.