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New York State Implements ABLE Accounts for the Disabled

Advocates for the disabled have long pushed for an easier way for disabled individuals to save small amounts of money in a savings account without disrupting their eligibility for government benefits such as Medicaid and Supplemental Security Income (SSI). In 2014, the Achieving a Better Life Experience (ABLE) Act was signed into law, but it was left up to each state to implement the program. Recently, New York State finally did so; New York State residents can now enroll in these accounts online at

ABLE accounts are modeled on the popular 529 College Savings Plans. An individual who was disabled before age 26 can deposit up to $14,000 per year into the account, which grows tax-free and can be used to pay for qualified expenses to maintain or improve quality of life. The ABLE account can also be funded by parents, family members and others who wish to contribute to the account. The funds in an ABLE account are not counted as a resource for most means-tested government benefit programs including Medicaid and SSI, with certain limits.

The primary drawback of an ABLE account is that upon the death of the disabled individual, any funds remaining in the account must be paid back to the state. In contrast, a Supplemental Needs Trust funded with assets from a parent, relative or other person does not require a payback and may be a better option in some cases.

An ABLE account is a cost-effective tool for helping disabled individuals and their families save small amounts of money for items not covered by government benefits. For larger amounts of money or for inheritances, aSupplemental Needs Trust generally offers better results. If a friend or family member is disabled and receiving benefits, our Elder Law attorneys can help you plan to protect their benefits. Click here to contact us, or call 631.390.5000.

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