ABLE TN Celebrates 5 Years of Helping Tennesseans with Disabilities Save, Invest
By Shelli King
ABLE TN reaches a major milestone this month – five years of helping people with disabilities save for the future. Tennessee launched one of the first Achieving a Better Life Experience (ABLE) programs in the nation in June 2016. In celebration, Gov. Bill Lee has proclaimed June 2021 as “ABLE to Save Month” in Tennessee.
ABLE TN, a program of the Tennessee Department of Treasury, provides individuals with disabilities the opportunity to save and invest with tax-free earnings, and take advantage of low fees, diverse options, and convenient online management — all to help participants maintain independence and quality of life.
According to the ABLE National Resource Center, millions of individuals with disabilities and their families depend on a wide variety of public benefits for income, health care and food and housing assistance. Eligibility for these public benefits (SSI, SNAP, Medicaid) require meeting a means/resource test that restricts eligibility to individuals with less than $2,000 in liquid resources, such as cash savings, non-ABLE checking and savings accounts and some retirement funds. To remain eligible for these public benefits, an individual must remain poor. For the first time in public policy, the ABLE Act recognized the extra and significant costs of living with a disability. This allows eligible individuals and their families to establish ABLE savings accounts that will largely not affect their eligibility for SSI, Medicaid and means-tested programs such as FAFSA, HUD and SNAP/food stamp benefits.
The independence and quality of life are reflected in the stories of ABLE TN account owners, who have shared that due to their savings, they are now ABLE to:
- “Live life more fully and empowered to maintain my goals.” – Silas Young
- “Have Peace of Mind for a Secure Future.” – Bobby Johnson
- “Attend Chattanooga Christian School where I’m receiving an excellent education that will lead to a regular high school diploma!” – Luka Hyde
- “Save for college, so I can get ready for a job I love.” – Eline Sharp
All Tennessee residents with a disability that occurred before their 26th birthday can open an ABLE TN account, if they are eligible to receive Supplemental Security Income (SSI), Social Security Disability Insurance (SSDI), or have obtained a disability diagnosis by a qualified physician. ABLE TN has created a tool, ABLE Assist, to help determine eligibility, available on ABLETN.gov. The individual with the disability is the owner of the account, but accounts may be created by the beneficiary, parents/guardians or a third-party legal representative. Individuals are limited to one ABLE account at a time. Currently, there’s an annual contribution limit of $15,000.
The Tax Cuts and Jobs Act of 2017, also known as the ABLE to Work Act, allows even more savings. Under this law, employed ABLE account owners who receive income and who do not participate in an employer-sponsored retirement plan may contribute above the $15,000 annual contribution limit.
These additional contributions are limited to the lesser of:
- The federal poverty level or the poverty level of your state of residence
- The account owner’s compensation included in the individual’s gross income for the taxable year
What does this mean? If you meet the eligibility requirements, in addition to the maximum $15,000 annual contribution limit, you may be able to deposit more funds in your ABLE TN account each year up to the Federal Poverty Guidelines, depending on your income.
More than $30.13 million has been saved to cover qualified disability expenses, such as education, assistive technology, and housing for more than 2,580 ABLE TN account owners. About $5.7 million or 19% of the total amount saved through ABLE TN was earned through investments. There is no impact on federal means-tested benefits for ABLE TN accounts with a balance of less than $100,000. ABLE TN offers participants the ability to select from 15 diverse investment options, the same top-performing investment options available through TNStars® College Savings 529 Program.
My thanks to Shelli and the crew at ABLE TN for sharing this update on the success of the ABLE TN program and the benefits that Tennesseans have seen as a result. I would encourage anyone who qualifies to set up an ABLE account, even if you’re only able to put small amounts of money into the account, because the investments will help the money grow. Such accounts can come in handy when disability expenses come up. Thanks for reading, and as always, if you have questions, email me at firstname.lastname@example.org.
Shelli King is the Communications Director for the Tennessee Department of Treasury. As communications director, Shelli serves as a spokesperson for the department, representing all of the department’s many programs, including ABLE TN.