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Opportunity for Public Input into IRS’ Proposed Regulations for Implementing ABLE Act

September 25, 2015

On June 19, 2015, the Internal Revenue Service (IRS) posted in its Notice of Proposed Rulemaking (NPR) its recommended approach for implementing the Achieving a Better Life Experience (ABLE) Act of 2014. The ABLE Act allows people with disabilities to create special tax-advantaged savings accounts that can be used for disability-related expenses. Account holders can save money in these accounts without becoming ineligible for Supplemental Security Income (SSI), Medicaid, or Medicaid Buy-In programs because the funds inside the ABLE accounts will not count towards the asset limits associated with each of these programs’ eligibility requirements. ABLE accounts can help workers with disabilities save their earnings and build a financial cushion, enabling them to maintain employment while keeping essential health care benefits.

The proposed regulations address several issues and concerns policymakers and advocates had with the ABLE Act’s provisions. The NPR explained how the ABLE accounts are to be administered and the expenses for which they can be used. Some provisions include broad and useful definitions of “disability-related expenses” under the Act, definitions of who can be a beneficiary and when they are eligible, the exemption of ABLE accounts from gross income, and an explanation of the reporting requirements for ABLE accounts.

Comments on the new regulations were due September 21, 2015. A public hearing on the new revisions is scheduled for October 14, 2015 at 10:00 a.m. The public hearing will be held in the Auditorium, Internal Revenue Building, 1111 Constitution Avenue, NW, Washington, D.C. Visitors must enter at the Constitution Avenue entrance. In addition, all visitors must present photo identification. The IRS requests that anyone planning to attend the hearing in person should contact Regina Johnson at (202) 317–6901 in order to be placed on the building access list. The IRS has not yet issued instructions on how to attend the hearing by electronic means. The proposed regulations can be read online.