ABLE account

What it means

Means-tested programs cap what somebody may own, and the cap is low enough that ordinary saving is impossible. An ABLE account is the exception Congress created: money in it does not count against Supplemental Security Income up to a limit, and does not count against Medicaid at all.

Eligibility turns on when the disability began rather than on when the account is opened. The statutory age of onset was 26 and was raised to 46 for 2026 onwards, which brings a large group of people into eligibility who were previously outside it.

Withdrawals have to be for qualified disability expenses, which is a broad category — housing, transport, education, assistive technology, basic living costs — rather than a narrow medical one. Anybody may contribute, subject to an annual cap.

One thing to check before opening one: some states recover Medicaid costs from what remains in an ABLE account at death, and others have waived that. It is a live difference between states.

Why it matters

It is the only way most disabled adults can hold savings in their own name without losing the benefits that pay for their care.

It works alongside a special needs trust rather than instead of one. The account gives the person control of modest amounts; the trust holds anything larger.

When you are likely to meet it

• When planning to leave something to a disabled child or sibling.
• When a disabled adult receives a gift or a settlement that would otherwise end their eligibility.
• When deciding between an ABLE account and a special needs trust, or using both.

How this varies by state

Each state runs its own ABLE program and most accept residents of any state. Whether Medicaid recovers from the balance at death is a state decision.

Related terms

• DependentSomebody who relies on you. It is a defined term in tax and in benefit programs, and it is not a category in inheritance law at all.
• MedicaidA joint federal and state program that pays for health care, including long-term care, for people with limited income and assets.
• Special needs trustA trust that holds money for a person with a disability without disqualifying them from means-tested benefits.
• Spend-downUsing up income or assets on care until they fall below the limit at which Medicaid will start paying.
• TrusteeThe person or institution that holds and manages trust property for the people it is meant to benefit.
• UGMA and UTMA accountsCustodial accounts holding money for a child, which the child takes control of outright at an age set by state law.

Official sources

The authority this page describes, at the agency that publishes it. Sahvelo does not restate a rule from a secondary source.

• IRS — ABLE accounts (opens in a new tab)

Sahvelo guidance that uses this

• Wills and trusts