ABLE Update: Social Security Administration’s Updated Guidance for SSI Beneficiaries
On March 8, 2018, the Social Security Administration (SSA) published an updated version of its Program Operations Manual System (POMS) regarding the ABLE Act and ABLE accounts. POMS is an operational policy reference used by SSA’s staff to conduct SSA business. Highlights include:
• Partnerships that States can use to administer ABLE accounts. The partnerships identified include:
(1) a consortium where the State has their own ABLE program, but joins other States so that it can provide lower administrative costs and better investment options than they could provide on their own;
(2) States with their own ABLE program, but contract with private companies or with other States to manage their ABLE program; and
(3) States that do not operate their own ABLE program, but partner with another State to offer the other State’s ABLE program to their residents.
• Treatment of duplicate ABLE accounts. If there is more than one ABLE account administered by a qualified ABLE program, the guidance discusses treatment of the account as a resource except for cases of a rollover or program-to-program transfer.
• Clarification of excluded contributions. The guidance clarifies the exclusion of contributions made into an ABLE account as income to the beneficiary and explains what income is countable when deposited into an ABLE account via direct deposit or otherwise. It discusses transfer of funds from a trust and when an ABLE contribution will be treated as a gift.
• Simplification of examples of Qualified Disability Expense (QDE) to make them more general (at the request of the Internal Revenue Service). The references to qualified disability expenses (QDEs) were changed to be consistent with the IRS ABLE law*.
• Data exchange. Guidance explains when the States began reporting monthly data to SSA and includes a list of the shared data.
• Usage of debit cards. Guidance provides details of the information that SSA will receive via data exchange about distributions made through an ABLE prepaid debit card. Monies distributed onto an ABLE prepaid debit card are considered a qualified distribution unless determined otherwise.
*Final IRS regulations have not been published. Therefore, the IRS position could change when the regulations are finalized. If this happens, SSA ABLE policy will be updated accordingly.
For more detailed information about the POMS and other ABLE-related questions, we encourage you to visit the ABLE National Resource Center at www.ablenrc.org.