IRS Releases Proposed ABLE Act Regulations
On Friday June 19th, the Internal Revenue Service (IRS) released the highly anticipated Notice of Proposed Rule Making (NPRM) for the Achieving a Better Life Experience (ABLE) Act. The NPRM stipulates the proposed rules and regulations by which the program will be developed and administered. These proposed rules and regulations are open for public comment until September 19th. In addition, a public hearing will be held on the morning of Octber 14th in Washington, D.C. to allow relevant stakeholders and the public at large to further express their comments regarding the details in the NPRM.
The Achieving a Better Life Experience Act authorizes tax-advantaged savings accounts for qualified people with disabilities to allow accrual of savings without impacting eligibility for certain public benefits. Under the proposed regulations, contributions to an individual’s ABLE account may not exceed the federal gift tax limit which is currently $14,000 per tax year. Funds may be used for qualified disability expenses aimed at maintaining and improving health, independence, or quality of life. Among others, permissible expenditures may include housing, transportation, employment training and supports, assistive technology, and health and wellness, all of which can enable beneficiaries to achieve more integrated lives and optimal self-sufficiency.