Frequently Asked Questions*
General
An ABLE Account is a tax-advantaged account that people with disabilities and their families can open to save, invest, and spend their money for expenses related to living with a disability. ABLE Accounts allow individuals to build savings while preserving benefits, such as SSI, Medicaid, HUD and others, and are an alternative or add-on to a special needs trust.
ABLE Accounts and Special Needs Trusts both offer certain financial solutions for people with disabilities, and both provide a way for people with disabilities to save money in a tax-advantaged way without jeopardizing eligibility for various public programs. Yet, ABLE Accounts and Special Needs Trusts differ in a number of important ways. For example, ABLE Accounts have an annual contribution limit while Special Needs Trusts do not. ABLE Accounts can be managed by the Account Owner, but Special Needs Trusts are administered by appointed trustees. ABLE Accounts generally allow for easier access to funds than Special Needs Trusts. In addition, funds in an ABLE Account can be used to cover housing expenses without affecting SSI, while using funds from a Special Needs Trust for housing could impact SSI benefits. ABLE Accounts are generally lower in cost to open and manage than a Special Needs Trust. A person with disabilities usually is not limited to choosing one or the other and maintaining both an ABLE Account and a Special Needs Trust might be desirable. Individual circumstances vary; consultation with a financial advisor should be sought when choosing among ABLE Account and Special Needs Trust opportunities to manage personal financial goals.
Generally, the earnings on your ABLE Account investments will not be subject to federal income tax as long as funds withdrawn from the Account are used for Qualified Disability Expenses. The same holds true for state income taxes in Indiana, as generally the earnings portions of distributions from your ABLE Account used for Qualified Disability Expenses also will not be subject to Indiana adjusted gross income tax. In addition, an individual who is an Indiana taxpayer may receive a tax credit against Indiana adjusted gross income tax for contributions made to an INvestABLE Indiana Account. The tax consequences from transactions involving an ABLE Account can be complicated, and individuals contributing to or benefiting from ABLE Accounts are encouraged to consult their tax advisors regarding their individual circumstances.
No. An Account Owner is limited to one ABLE Account, except in the case of an Indirect Rollover or a Direct Rollover from another ABLE account.
In the case of Indirect Rollovers and Direct Rollovers to and from the same ABLE Account Owner, the entire balance of the ABLE account must be transferred. For Indirect Rollovers, the ABLE account from which the funds are withdrawn must be closed within 60 days of the withdrawal and for Direct Rollovers, the ABLE account from which the funds are withdrawn must be closed upon completion of the Direct Rollover.
- SSI disregards ABLE Account balances when determining benefits, except in 2 situations:
- When ABLE Account balances exceed $100,000; and
- When you withdraw funds for housing expenses and the funds are not used in the same calendar month as the withdrawal and/or Non-Qualified Withdrawals.
- Medicaid disregards ABLE Account balances when determining Medical Assistance (Medicaid) eligibility.
- SNAP (Supplemental Nutrition Assistance Program) disregards ABLE Account balances when determining SNAP eligibility.
- HUD (US Department of Housing and Urban Development) disregards amounts in an ABLE Account for the purpose of determining eligibilty and continued occupancy.
- Assets in an ABLE Account are not considered resources for purposes of means-tested state benefits, and distributions for Qualified Disability Expenses are not considered income for Indiana state benefits eligibility programs that limit eligibility based on income.
- The Indiana Family & Social Services Administration (FSSA), through its Estate Recovery Program, may make a claim against an ABLE Account after an Account Owner’s death to recover certain medical assistance paid under Medicaid. For more information, go to https://www.in.gov/fssa.
Eligibility
A person is eligible for an ABLE Account if their disability was present before the age of 26, and one of the following is true:
- They are eligible for Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI) because of disability or blindness as defined by the Social Security Act (SSA).
- They have a medically determinable physical or mental impairment with marked, severe functional limitation that has lasted, or is expected to last, at least 12 continuous months or to result in death, with a written disability-related diagnosis by a physician.
- They have identified their condition on the Social Security Administration’s List of Compassionate Allowances Conditions.
Eligibility is determined by the age of onset. Therefore, even if the diagnosis did not occur until after age 26, if the onset occurred before attaining age 26, then the individual may be eligible to own an ABLE Account.
No. However you must meet the ABLE eligibility requirements (refer to, “Who is eligible to own an ABLE Account”, above).
No. However, you should have a record of the doctor’s signed diagnosis, benefits verification letter from the Social Security Administration, or other relevant documentation for Account verification in case it is requested by the ABLE plan or the governing bodies of ABLE: SSA or the IRS.
In the Account enrollment process, you will be asked to certify that if your condition ever changes so that you would no longer be eligible for an Account that you will notify the ABLE Plan. Based on that certification, the ABLE Plan will assume your eligibility continues until you notify the ABLE Plan of any change.
You can keep your ABLE Account open in case your disability later worsens, and you become eligible again. However, additional contributions cannot be made to your Account and any withdrawals you make while you are ineligible will be considered Non-Qualified Withdrawals.
Account Opening
The INvestABLE Indiana Account must be opened directly through the Plan at https://savewithable.com/in/home.html or by completing and mailing a paper Enrollment Form. You cannot go to a bank or physical location to open an INvestABLE Indiana Account.
There is no fee to open an Account, and it can be opened with an initial contribution of just $1.
Certain fees may apply to the maintenance of an Account, including the following:
- An Account is charged an Annual Account Maintenance Fee of $56 ($14 withdrawn quarterly). This can be lowered to $31 ($7.75 withdrawn quarterly) if electronic delivery is selected.
- If the Checking Account Option is selected, there is a $2.00 monthly fee, which is waived if Electronic Delivery of monthly checking account statement notification is selected OR with an average monthly Account balance of at least $250 in the checking account.
- The Annual Asset-Based Fee per Investment Option on assets per Investment Option range from 0.28% to 0.34%, depending on which Investment Option(s) are selected. The Checking Account Option is not subject to the Annual Asset-Based Fee.
If a withdrawal is not used for a Qualified Disability Expense, the earnings portion of the withdrawal is subject to income tax and the Federal Penalty Tax (an additional 10 percent penalty on the earnings portion of the withdrawal). Withdrawals not used for Qualified Disability Expenses could also affect other benefits. Speak to a tax professional and/or a benefits specialist about your specific circumstances.
Eligible Individuals can open and manage the Account for themselves. Alternatively, an Authorized Individual may open and manage an Account on behalf of an eligible minor or an eligible adult who lacks Legal Capacity, or as an agent under power of attorney for an eligible adult with Legal Capacity who is unable or chooses not to do so on their own. The Authorized Individual must certify that they rank highest in the following hierarchy and is willing and able to manage the Account:
- Power of Attorney
- Conservator or Legal Guardian
- Spouse
- Parent
- Sibling
- Grandparent
- SSA-appointed Representative Payee
An Eligible Individual living in any state, US territory or military base, may open an Account.
Tax considerations associated with opening and maintaining an Account vary among the states. For example, Indiana taxpayers may earn a tax credit for contributions to an INvestABLE Indiana Account (refer to “What are the tax advantages of an ABLE Account?” above).
No. Each ABLE Account is specific to one Eligible Individual.
Yes, but only a transfer to another Eligible Individual who is also a Sibling of the Account Owner is permitted.
Yes. During his or her lifetime, an Account Owner may designate a Successor Account Owner, who must be both an Eligible Individual and a Sibling of the Account Owner.
If an Account Owner moves to another state, the Account still may remain in the INvestABLE Indiana Plan. Alternatively, the Account Owner can rollover the ABLE Account into another state’s ABLE plan. An Account Owner is encouraged to consult with a financial or other professional advisor regarding the specific rules governing a rollover of an Account to another plan.
You may choose to have the funds in your ABLE Account invested in a single Investment Option or any combination of up to eight of the Investment Options offered. Seven of the Investment Options are Asset Allocation Investment Options with varying blends of stocks, bonds, cash, and money markets from conservative to aggressive. The eighth Investment Option is an FDIC-insured interest-bearing Checking Account Option with an optional debit card that is provided through Fifth Third Bank, National Association.
For existing funds in your Account, you may change your selected Investment Options up to two times per year. You can change your Investment Options for future contributions to your Account at any time.
Authorized Individuals
An Authorized Individual manages all Account contribution, withdrawal, and maintenance matters on behalf of the Account Owner and for the Account Owner’s benefit. Applicable law prohibits an Authorized Individual from acquiring any beneficial interest in an ABLE Account during the Account Owner’s lifetime.
A person or an entity that has been appointed as a representative payee by the Social Security Administration can open and manage an INvestABLE Indiana Account for the benefit of an Eligible Individual so long as they can certify that there is no other person or entity with a higher priority on the list of possible Authorized Individuals that is willing and able to open and manage an INvestABLE Indiana Account for the Account Owner.
An Interested Party can be a person or Entity that receives duplicate Account statements and can access information about the Account by calling customer service. Interested Parties cannot transact on the Account or access the Account online.
Making Contributions to an Account
Contributions to an Account cannot exceed $19,000 per year (2025). This amount is tied to the federal annual gift tax exclusion limit and may adjust periodically to account for inflation. Contributions generally can be made from any source. If the Account Owner is working, and they do not participate in an employer-sponsored retirement program, they may contribute more to the Account. See the next question for additional details.
For SSI beneficiaries, up to $100,000 can be saved in an ABLE Account without affecting their monthly cash benefit. For more information, go to https://secure.ssa.gov/poms.nsf/lnx/0501130740. Total Account balances are limited to $450,000. No new contributions may be accepted into an INvestABLE Indiana account once the Account balance reaches $450,000.
Yes. If the Account Owner is working, has earned income, and does not participate in an employer-sponsored retirement plan, then an additional amount equal to the lesser of the following generally may be contributed to the Account in a selected calendar year:
- Account Owner’s earned income for the calendar year, or
- U.S. Department of Health and Human Services Poverty Guidelines amount for a one-person household in the Account Owner’s state of residence (U.S. Department of Health and Human Services Poverty Guidelines change annually).
Contributions come from any source: the Account Owner, family, friends, inheritances, fund-raisers, insurance settlements, crowd funding, and third parties. Ugift ABLE is an easy way for third parties to make gift contributions directly into the Account.
Ugift® is a feature of your ABLE Account that allows friends and family to contribute to your savings in lieu of traditional gifts. It is simple to use – just log in to your Account to find your code and share it with friends and family, who can use it at UgiftABLE.com to contribute directly into your Account. Learn more by reading our Ugift ABLE FAQ.
Contributions to your ABLE Account are not deductible for purposes of Indiana adjusted gross income tax (Indiana income tax. However, an Indiana taxpayer who contributes to an INvestABLE Indiana Account may qualify for an Indiana state income tax credit of up to 20% of the total contributions made (up to a maximum of $500).
Yes. A rollover from a 529 Education Savings Plan into an ABLE Account can be made for the same individual or for a member of the family of the 529 education savings account beneficiary. Amounts contributed to an INvestABLE Indiana Account by rollover from a 529 Education Savings Plan are not eligible for purposes of the Indiana state income tax credit for contributions to an ABLE Account. Rollovers from 529 Education Savings Plan accounts are subject to annual limits (generally equal to the annual ABLE Account contribution limit). Individual circumstances and tax consequences vary, and any person is encouraged to speak with a financial advisor or tax professional when considering a rollover from a 529 Education Savings Plan.
Yes. Depending on your adjusted gross income, the amount of the Saver’s Credit can be 50%, 20%, or 10% of contributions made to an ABLE Account of which you are the designated beneficiary. Rollover contributions do not qualify for this credit. The maximum contribution amount that may qualify for the credit is $2,000 ($4,000 if married filing jointly), making the maximum credit $1,000 ($2,000 if married filing jointly). See Form 8880, Credit for Qualified Retirement Savings Contributions, for more information.
No, an ABLE account does not shield income for benefit-eligibility. There is no change in the way the income of the ABLE Account Owner is counted by means-tested benefit programs. Employment earnings are still counted as earned income or in terms of substantial gainful activity (SGA) and are taken into consideration when determining eligibility for certain public benefits.
These are contributions of a specific amount made automatically into an account on a custom frequency basis. For example, you can set up recurring contributions of $25 per month. This makes the process of saving very simple.
Using ABLE Assets for Qualified Disability Expenses
Funds may be used for Qualified Disability Expenses, which may include any expense related to the Account Owner as a result of living with a disability and improves their health, independence, or quality of life. These include, but are not limited to basic living expenses, education, food, housing, transportation, employment training and support, assistive technology, personal support services, health care expenses, financial management, and administrative services.
The earnings portion of ABLE Account funds used for purposes other than Qualified Disability Expenses (i.e. a Non-Qualified Withdrawal) may be subject to federal income tax and a penalty tax, as well as applicable state and local income taxes and penalties.
Yes. Housing expenses and housing-related expenses, including mortgage, rent, real property taxes, heat, fuel, gas, electric, water, sewer, and garbage services. An Account Owner should be careful to ensure that withdrawals for housing expenses occur in the same month that housing expense payments are made, as withdrawn funds retained from one month into the next might affect resource calculations for purposes of SSI and other means-tested benefit programs.
Withdrawals can be made online, by completing a withdrawal form, or by calling the Plan’s dedicated Client Services phone number. For Accounts invested in the Checking Account Option, withdrawals can also be made using the Fifth Third Bank debit card and checks. Legal restrictions may affect the availability of certain withdrawal options.
Not at the time of the withdrawal. Annually, the total amount of withdrawals will be reported to the IRS and the date and amount of each withdrawal will be reported to the Social Security Administration. It is recommended that you keep detailed records of your withdrawals and payments in case of examination by the IRS or the Social Security Administration.
Generally, upon the death of an Account Owner, the funds from an Account can be used by the estate to pay any outstanding Qualified Disability Expenses, including funeral and burial costs. If the Account Owner was receiving Medicaid benefits, the applicable state Medicaid agency may file a claim for a payback upon the Account Owner’s death after any outstanding Qualified Disability Expenses have been paid for from the Account. For an Account Owner receiving Indiana Medicaid benefits, the Indiana Family & Social Services Administration (FSSA), through its Estate Recovery Program may make a claim against an ABLE Account after an Account Owner’s death to recover certain medical assistance paid under Medicaid. For more information, go to https://www.in.gov/fssa If Medicaid does not recapture, Account funds generally will go to the Account Owner’s estate or to a Successor Account Owner. Account Owners are encouraged to speak with an estate planning professional regarding the consequences their death may have on their ABLE Account.
*Capitalized terms not defined in these FAQs have the meanings set forth in the Plan Disclosure Booklet.