State’s ABLE Savings Plan a boost for people with disabilities

Washington residents with disabilities can save for the future through the recently rolled out ABLE Savings Plan. The plan, which is administered by the state Department of Commerce, officially launched July 23.

It allows people with disabilities to save up to $15,000 annually without losing benefits such as Supplemental Security Income or Social Security Disability Insurance.

“People with disabilities who need to be on benefits are almost obligated to live a life of poverty. ABLE solves that,” said Peter Tassoni, disability workgroup manager.

Previously, people with disabilities who received government benefits could own nothing worth more than a total of $2,000 or be disqualified from benefits. A birthday check from Grandma could put them over the resource limit.

The Stephen Beck Jr. ABLE — or Achieving a Better Life Experience — Act of 2014 allows people with disabilities to open tax-free savings accounts and keep their benefits. Twelve states are still developing ABLE plans. Oregon launched its plan in December 2016 and Washington worked with Oregon, making its plan almost identical.

Tassoni said some legislative inconsistencies at the state level delayed the launch of Washington’s plan. Senate Bill 6221 that passed in June fixed those issues and made the legislation consistent with federal standards. Somewhere between 130,000 and 180,000 people statewide are eligible for accounts.

Until June 30, 2019, the $35 maintenance fee is waived — an incentive to get people to sign up. Although beneficiaries can’t have more than one account, they can choose a plan with any state or enroll in ABLE for All, the national plan.

People with ABLE plans can get a prepaid card and use it for Starbucks, transportation, assistive technology, hiring an employment coach or going to the movies. Whatever the purchase is it has to be for the benefit of the beneficiary.

“You can use it for everyday expenses, your groceries, your rent,” Tassoni said.

Having a prepaid card rather than a debit card is another security check; if the beneficiary loses their card, they won’t be vulnerable to having all of the money in their account stolen.

People with any disability that qualifies for Supplemental Security Income or Social Security Disability Insurance or blindness that developed before the age of 26 can sign up for an ABLE account. There’s been a push at the congressional level to change that age of onset to 46.

“That’s going to capture a lot of people in their early working years” who may get hurt on the job, Tassoni said.

Many of the people with an ABLE Savings Plan have a developmental or intellectual disability. Tassoni said about 45,000 state residents are registered with the Developmental Disability Administration.

“As parents who have children with special needs, one of our biggest concerns is what will happen when we’re not around?” said Darla Helt, a parent and executive director of the Vancouver-based Parents Empowered And Communities Enhanced, or PEACE, an organization that advocates for people with intellectual or developmental disabilities.

She said families should look into the ABLE Savings Plan and the Developmental Disabilities Endowment Trust Fund and figure out which option — or both — might be best.

“There are pluses and minuses to each of them,” Helt said.

Local attorney Eva M. Luchini does estate planning and has a passion for families with special needs children. She’s also on the governing board for PEACE and the Endowment Trust Fund.

“Families need to have something for now and something for later,” said Luchini, who primarily works with parents. “They worry, ‘What’s going to happen when we die?’ … After a long day of caring for a special needs child, it’s a worry that keeps them up at night.”

There are important differences between ABLE and the Endowment Trust Fund, which has been around since 2002. While ABLE has the annual $15,000 limit, the trust fund has no limit to how much money can be added annually. So, an inheritance would need to be directed to the trust fund, while ABLE is a great option for someone who’s working and wants to stow away their extra wages, Luchini said. A trust can absorb bigger amounts of money that can trickle out to an ABLE account. However, it takes $600 to open a trust fund, and the fund is specific to people who have an intellectual or developmental disability. ABLE’s definition of disability is broader.

“Both have great uses for families. It’s fantastic that we now have ABLE accounts to add to our little basket of special needs planning options,” Luchini said.