Achieving a Better Life Experience (ABLE) Accounts Final Regulations Issued

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Final regulations for Achieving a Better Life Experience (ABLE) accounts were issued earlier this month. The final regulation can be found at IRS.gov.

ABLE accounts are designed to help people with disabilities and their families save and pay for disability-related expenses. Though contributions are not deductible, distributions, including earnings, are tax-free to the designated beneficiary if used to pay qualified disability expenses. These expenses can include housing, education, transportation, health, prevention and wellness, employment training and support, assistive technology and personal support services and other disability-related expenses.

Key Points:

  • Eligible individuals may now put more money into their ABLE account
  • Eligible individuals may roll money from their qualified tuition programs (529 plans) into their ABLE accounts
  • Certain contributions made to ABLE accounts by low- and moderate-income workers may now qualify for the Saver’s Credit
  • Guidance provided on the gift and generation-skipping transfer tax consequences
  • Guidance provided on the federal income, gift and estate tax consequences of distributions from, and changes in the designated beneficiary of, an ABLE account.
  • Rollovers from 529 plans, together with any contributions made to the designated beneficiary’s ABLE accountant (other than certain permitted contributions of the designated beneficiary’s compensation) cannot exceed the annual ABLE contribution limit.

Check out the final regulation on IRS.gov.

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Gary DeHart has worked in media for more than 25 years and has been instrumental in developing new revenue streams and business opportunities for the companies he has worked for. Prior to launching Insightful Accountant (formerly Intuitive Accountant), Gary was the Associate Publisher of Accounting Today. Prior to working in media serving the public accounting market, he worked in media for employee benefit managers and brokers, automotive design, textile manufacturing and recreational boating. In addition to being the Publisher and Managing Partner of Insightful Accountant, Gary works with select clients within the accounting market on channel development and growth. He is an Assistant Scoutmaster with the Boy Scouts of America, enjoys fly fishing, time on the beach, cooking on the Big Green Egg and spending time with his family.