A new bill to create tax-free savings accounts for individuals with disabilities and their families passed Congress Tuesday. Its known as the Achieving A Better Life Experience or ABLE Act. The money in 529-style accounts would remain tax-free as long as it is used for qualified expenses, such as education, housing, health care and transportation. The maximum amount in a 529-ABLE plan will still be limited to the same maximum that otherwise applies to (college-based) Section 529 plans in the state – which means its funding will be more limited than what potentially be placed into a special needs trust - and as with other 529 plans, only cash can be contributed (no in-kind property contributions). In addition, contributions to 529-ABLE plans will still be subject to normal gift tax limitations.
Posted on: Thu, 18 Dec 2014 13:29:26 +0000
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