The Choose Act, officially known as the Achieving a Better Life Experience (ABLE) Act, is a federal program allowing individuals with disabilities and their families to save money tax-free for qualified disability expenses. However, there isn't a specific "income limit" for the Choose Act itself. Eligibility isn't determined by income but rather by the onset of the disability. The disability must have begun before the beneficiary turned age 26.
The confusion around income limits often stems from the interplay between the ABLE program and other state and federal assistance programs. While the ABLE account itself has no income restrictions, the assets within the ABLE account can impact eligibility for other benefit programs, such as Medicaid and Supplemental Security Income (SSI).
How Assets in an ABLE Account Affect Other Benefits in Alabama
This is where understanding potential income and resource limits becomes crucial. Alabama, like other states, has specific eligibility criteria for Medicaid and SSI, and having assets in an ABLE account can affect a recipient's eligibility for these benefits. These limits are regularly updated, so it's vital to consult the most current information from the Alabama Medicaid Agency and the Social Security Administration (SSA).
Here's what you need to know:
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Medicaid: Alabama's Medicaid program has resource limits that determine eligibility. The value of assets in your ABLE account will be considered part of your total resources. While the ABLE Act protects the first $100,000 in the account from impacting SSI eligibility (a federal provision), it does not offer the same protection for Medicaid, which is primarily a state-administered program. Exceeding Alabama's Medicaid resource limit could lead to the loss of benefits.
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SSI: Supplemental Security Income (SSI) has both income and resource limits. The ABLE Act specifically protects the first $100,000 in an ABLE account from being counted towards the resource limit for SSI. However, this protection does not extend to the income generated by the ABLE account. Any earnings from investments within the ABLE account could impact SSI eligibility, depending on the total income.
Finding the Right Information:
To determine how an ABLE account might affect your eligibility for Medicaid or SSI in Alabama, it is crucial to:
- Contact the Alabama Medicaid Agency directly: They will have the most up-to-date information on resource limits and eligibility criteria.
- Contact the Social Security Administration (SSA): They can provide specific guidance on how ABLE account assets and earnings might affect your SSI benefits.
- Consult with a qualified financial advisor: A financial advisor specializing in disability planning can provide personalized guidance based on your specific circumstances.
In summary: While the Choose Act itself has no income limits, the impact of an ABLE account on other government assistance programs in Alabama depends on the state's specific resource and income limits for Medicaid and SSI. It is essential to research these limits and seek professional advice before opening an ABLE account.
