Updated as of September 14, 2024.
How Can an ABLE Account Benefit Me?
More savings ability
Allows you to save resources far more than the $2,000 SSI limit ($3,000 for couples)
Up to $100,000 in an ABLE Account is excluded from means-tested programs, such as SSI, SNAP, FAFSA
Gifts and other deposits made directly into your ABLE Account do not count as income for SSI purposes
Flexibility
Allows you to withdraw ABLE Account funds at any time
Funds may be used for a broad range of activities and purchases
Money grows more quickly
Invested money grows tax-free
No taxes when withdrawing funds for qualified purposes
Qualified withdrawals do not count as income for SSI or SSDI eligibility
Tax benefits
In Maryland, a STATE tax deduction of up to $2,500 per donor per ABLE account is available ($5,000 for joint filers)
ABLE Account withdrawals are never taxed
Who is Eligible for an ABLE Account?
Disability requirements and age factors
Qualifying disability
MEDICALLY entitled to SSI or SSDI benefits based on blindness or disability
OR
Self-certification of a similarly severe disability, if not entitled to SSI or SSDI
Age of disability onset
The qualifying disability must have occurred BEFORE age 26
It’s OK if you are over 26 now, but you must be able to prove that you had the qualifying disability before turning 26 years old
Note: on January 1, 2026, the maximum age of disability onset increases to 46
Citizenship/residency
ABLE Accounts are available only to U.S. citizens and legal residents
In Maryland, you do NOT need to be a state resident to open a Maryland ABLE Account
No financial requirements
No income limits
No limits on other, non-ABLE resources
Can I Get an ABLE Account if I do not receive SSI?
YES!
The key is disability and age of disability onset, not income or resources.
ABLE Accounts can grow to over $100,000
In 2023, Maryland ABLE Accounts can grow to $500,000
For individuals who are not receiving SSI, the ABLE Account represents a flexible vehicle for tax-free savings
Annual contributions limits:
For 2024, $18,000 (per beneficiary, no matter how many contributors)
If you work, you may add an ADDITIONAL amount to your ABLE Account
- In Maryland, you may deposit an additional $14,580 or your gross (before taxes) wages, whichever is less
Friends and family can contribute via online and paper check gifting options
- These do NOT count as income for SSI or SSDI (or for other means-tested programs)
- These DO count toward your maximum annual contribution limits
How Can I Spend My ABLE Account Funds?
Qualified Disability Expenses (QDE)
Federal law defines “Qualified Disability Expenses” as: “Any expenses related to the eligible individual’s blindness or disability which are made for the benefit of an eligible individual”
This includes, but is not limited to the following categories:
Education
Textbooks; Tuition; Certification; Trade school; Training; Attendant fees (if applicable)
Housing
Mortgage (including property insurance, if required); Real property taxes; Rent
Transportation
Car; Bus; Metro; Subway; Uber; Taxi; Train; Plane; Gas money; etc.
Employment training and support
Tools; Work-related uniforms; certification & licensing fees; Job coaching
Start-up fees for entrepreneurs
Assistive Technology and personal support devices
Computer; Screen reader; iDevices; Apps; Hearing aids; Communication devices; Guide dog expenses
Wheelchairs, walkers, hospital beds, and other durable medical equipment
Health, prevention and wellness
Medical bills; Medications; Exercise services or equipment
Financial Management and administrative services
Tax preparation; Financial advisor services
Legal services
Attorney fees; Court fees
Funeral and burial expenses
Pre-planning fees for burial; Funeral and burial expenses
Additionally, basic living expenses, including, but not limited to food; heating fuel; gas; electricity; water; sewer; garbage removal) are considered qualified disability expenses (QDE).
Tax-free withdrawals on QDE
Interest and account growth is tax-free
Principal may be withdrawn tax-free, even if someone received a tax deduction for contribution into the ABLE Account
Transfers of ABLE Accounts
From 529 accounts: Yes, transfers ARE allowed
Excess income: Yes!
- Earned income up to $14,580 in gross wages
- Unearned income (gifts, bequests, etc.) to reduce your resources for SSI eligibility
From one state’s ABLE account to another: Yes, but some charge fees to do so
How Can I Open an ABLE Account?
Who can open an ABLE Account?
The eligible individual
If the eligible individual is a minor (younger than 18 years old), an ALR (authorized legal representative, such as a parent, legal guardian, Power of Attorney) may open the account in the eligible person’s name
If the eligible individual is older than 18 years old an ALR may open the account in the eligible person’s name and manage it on behalf of that person
Can I open an ABLE Account at my local bank or credit union?
No
ABLE Accounts are managed by state agencies; No private bank, credit union, or brokerage firm may offer any ABLE Accounts
In Maryland, all ABLE Accounts are administered by Maryland ABLE
How Much Do ABLE Accounts Cost?
Each state sets its own fees for ABLE Accounts
In Maryland, costs associated with ABLE Accounts include:
- Annual maintenance fees
- Fees for deposits or gifts IF they are made by debit or credit cards
- Prepaid VISA card
- $1.25 per month
- Fees to replace lost cards
- Paper check fee
- If you want to take money out of your ABLE Account via a paper check
- $2.50 per check
Minimum opening amounts and deposits
Like fees, states set their own rules for minimum opening balances and minimum deposits
In Maryland:
- Minimum amount to open an ABLE Account: $25.00
- Minimum deposit amount: $10.00
How many ABLE Accounts may I have?
An eligible individual may only have ONE ABLE Account at a time
This is true no matter what the person’s age is
Will ABLE Accounts Travel With Me if I Move?
No, but, in most cases, you can transfer your ABLE account from one state to another
If you want to transfer your ABLE Account to a different state, contact the new state’s office for how to do so
Do I have to use my own state’s ABLE Account?
No
Some states, only allow their own residents to open ABLE Accounts
Is there any benefit in choosing my own state’s ABLE Account plan?
Typically, the only benefit in choosing your own state’s ABLE Account plan is if the state offers a state income tax deduction for ABLE Account deposits
Maryland DOES offer a $2,500 tax deduction per ABLE Account, but it is only available to Maryland residents who make deposits into Maryland ABLE Accounts ($5,000 for joint filers)
- Thus, a Maryland resident who has an out-of-state ABLE Account will not get a state income tax deduction for contributions to that account
Can my ABLE Account Money be Invested in the Stock Market?
Yes, but you must use the options available in your plan
Maryland ABLE’s investment options (may use one or more of the following):
- Cash Option
- 100% placed into an FDIC-insured account with The Bank of New York Mellon
- Insured up to $250,000
- ABLE Fixed Income: 0% stocks; 100% bonds
- ABLE Conservative: 20% stocks; 80% bonds
- ABLE Moderate: 50% stocks; 50% bonds
- ABLE Aggressive: 84% stocks; 16% bonds
How Do I Choose the Best ABLE Account For Me?
Similarities and differences between state ABLE Account plans
ABLE Account rules about contribution limits and the use of funds are set by the federal government, so all states follow those same rules
When choosing between different state plans, consider factors like:
- Annual Maintenance fees
- Investment options offered
- Ease of withdrawing funds
- Debit/Credit cards
- Fees for these withdrawal methods
- Ease of depositing funds
Check out the Three-State Comparison Tool from the ABLE National Resource Center
More About ABLE Accounts
Comprehensive post: All About ABLE Accounts
Individual topics
- About ABLE Accounts
- Benefits of ABLE Accounts
- Who Qualifies for an ABLE Account?
- How Can ABLE Account Funds Be Spent?
- How Much Money Can Go into an ABLE Account?
- How Do I Set Up an ABLE Account?
- What Else Should I Know About ABLE Accounts?
- Words of Warning About ABLE Accounts
Contact the Bridges Helpdesk for More Information
Email: Helpdesk@imagemd.org
Text: Send to: (410) 357-1546
Voice mail: Call (410) 357-1546, leave a voice mail message, and we will return your call
This unique project is being coordinated through The IMAGE Center of Maryland, a center for independent living in Towson, and it is funded by a grant from the Maryland Department of Education Division of Special Education/Early Intervention Services.