Is Your Client Eligible for an ABLE Account? Learn More Here.


The lifetime cost of living for individuals with disabilities can be staggering. An ABLE account is a savings account that grows tax-free and can be used to pay for disability-related expenses. It may also help protect eligibility for needs-based benefits. Keep reading to learn whether an ABLE account is suitable for your client.

ABLE Account Eligibility Criteria

When the Achieving a Better Life Experience (ABLE) Act became law in 2014, eligibility was only open to individuals who became disabled before age 26. In December 2022, the ABLE Age Adjustment Act was approved as a part of the Omnibus Appropriations bill. As of January 1, 2026, the age of disability onset will be raised from 26 to 46.

In addition to the age requirement, an ABLE account beneficiary must meet the Social Security Administration’s disability criteria.

ABLE Account Contribution Limits

ABLE accounts have lifetime and annual contribution limits. Lifetime limits vary by state, with most states setting limits over $500,000. The yearly contribution limit for 2023 is $17,000; however, currently employed beneficiaries may be able to make additional contributions.

Eligible ABLE Account Distributions

Funds from an ABLE account can pay for disability-related goods and services solely for the beneficiary. Eligible expenses include but are not limited to basic living expenses, housing, transportation, education, assistive technology, health-related costs, ABLE account oversight expenses, and more.

ABLE Accounts & Needs-Based Government Benefits

Funds held in an ABLE account are sheltered from government benefit asset testing up to $100,000. If the individual has more than $100,000 in an ABLE account or between an ABLE account and other countable resources, then SSI benefits will be suspended. Eligibility resumes when the individual’s total countable resources fall below the $100,000 threshold.

Conversely, Medicaid eligibility is not impacted by the amount in the ABLE account. However, depending on the state, funds remaining in the account upon the beneficiary’s death may be subject to a Medicaid Payback Provision.

Another option that allows individuals with disabilities to protect needs-based government benefits is a Special Needs Trust (SNT). Funds held within an SNT are exempt from asset tests and do not have contribution limits. An SNT can also be set up to make annual payments to an ABLE account, maximizing the benefits of both financial tools.

Contact Sage Before You Settle 

An ABLE account can provide your client with a tax-advantaged way to cover disability-related expenses. For more information, contact your Sage consultant before your case settles.