Washington, D.C., July 9 – Alabama Governor Kay Ivey signed Act 2021-514 allowing ABLE Savings account holders to deduct up to $5,000 per year per taxpayer on State Income Taxes. The plan, announced by Alabama State Treasurer John McMillian, aims to make saving achievable for people with disabilities by allowing ABLE account holders to save without losing the public benefits which many individuals with disabilities depend on.
What are ABLE Accounts?
In 2014, the 113th Congress passed H.R. 647, the Stephen Beck Jr. Achieving a Better Life Experience Act (ABLE Act), which established tax-advantaged savings accounts for people with disabilities and their families. The ABLE Act was designed to support people with disabilities who are required to meet means/resource tests to continue receiving potential life-saving benefits. Members of the disability community who are on benefits are restricted to having less than $2,000 in liquid resources. Millions of people with disabilities rely on public programs for income, health care, housing assistance and food security. ABLE Accounts allows people with disabilities to accumulate savings that do not affect their eligibility for these benefits.