STABLE Kentucky program allows disabled Kentuckians to have savings accounts without risk of losing federal aid
12/14/2016 05:21 PM
FRANKFORT – Disabled individuals dependent on benefit programs such as Medicaid and SSI can now begin savings through a program announced by state Treasurer Allison Ball.
The STABLE Kentucky program, which came about because of the passage of a federal law The Achieving a Better Life Experience Act, ABLE, allows individuals with disabilities the opportunity to save and invest money without losing eligibility for certain public benefits programs, like Medicaid, SSI, or SSDI. Earnings in STABLE Kentucky Accounts are not subject to federal income tax, so long as funds are spent on qualified disability expenses.
Previously, disabled individuals who had savings accounts risked losing some federal assistance.
STABLE Kentucky stipulates that those diagnosed with a disability before their 26th birthday have a right to establish savings accounts that aren’t subject to income tax as long as those funds are used for qualified disabilities.
In addition, families can set aside money for things such as housing, healthcare, education and transportation for the disabled family member.
Ball told members of the Interim Joint Committee on Health and Welfare that it allows some independence for many disabled Kentuckians.
“It gets them less dependent on some government benefits,” Ball said. “It helps people secure their own future a little bit more.”
Individuals are limited to contributing no more than $14,000 per year to their savings accounts.
“One of the very, very, very nice things about this is that family members can contribute to it,” Ball said. “Prior to this time, family members couldn’t legally help other family members who had disabilities because it would affect their ability to receive benefits from the government.”
Sen. Danny Carroll, R-Paducah, who has a special needs daughter, says that the program brings peace of mind for parents of special needs individuals.
Earnings and distributions from a STABLE Kentucky Account for qualified disability expenses do not count as taxable income of the contributor or eligible beneficiary at the federal level.
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