The IRS or Internal Revenue Service is aware of the fact that living with a disability could be really expensive. It is sometimes essential to buy some necessary equipment or have medical expenses regularly.
ABLE accounts are something the IRS wants people with a disability to know about. They could be really advantageous because they provide eligible people with valuable tax benefits. Saving or getting money is a must in the current financial situation.
If you have never heard of the IRS ABLE accounts, it is high time you did so. Getting some help to purchase mobility aid or pay for disability-related expenses will certainly come in handy.
What do ABLE accounts stand for?
ABLE accounts stand for Achieving a Better Life Experience accounts says the IRS. It comes from the ABLE Act of 2014. The aim of this act is to help or let states set up programs so that people with a disability can save on taxes.
Thus, these IRS tax-advantaged programs are for those who are eligible and have a disability. Allowing them to pay any qualifying disability expenses is their goal. Bear in mind that distributions can be tax-free if they are used for disability expenses that qualify.
Will ABLE accounts affect my eligibility for other government assistance programs?
A good thing about the IRS ABLE accounts is the fact that they never affect a person’s eligibility for assistance programs by the federal government. There are more advantages to ABLE accounts. Increasing the amount of contributions that the IRS allows you is also possible. It includes special rules for them too.
Another thing ABLE accounts are great for is a beneficiary could claim the saver’s credit for those contributions to that account. What is more, the IRS ABLE accounts allow rollovers in limited amounts. They could be from a 529 qualified tuition program account of the beneficiary to their ABLE account.
ABLE accounts are a valuable tax benefit for taxpayers with disabilities. Learn how these accounts may help you pay for qualified disability-related expenses: https://t.co/tIrooYPAy7 #IRS pic.twitter.com/3OlFte0UXy
— IRSnews (@IRSnews) May 23, 2023
The IRS limit contribution to ABLE accounts was 16,000 in 2022. However, this amount increased to 17,000 dollars in 2023. So, keep in mind that some employed able account beneficiaries might be able to make additional contributions up to a limit.
As for the retirement savings contributions credit or saver’s credit income limits increased. The credit rate is 0% of your contribution for single filers $36,500 or $73,000 for couples. Open an ABLE account now if you qualify on their program’s website. Or call their phone number to help customers.